Bebo is in discussions with mobile operators over the launch of a range of text messaging services in the first quarter of next year.

The companies plan to use SMS to extend Bebo’s functionality onto mobiles, unlike the WAP-based services being developed by some of its rivals.

Mobile operators are keen to regain some of the SMS traffic they have lost due to social networking sites’ popularity among younger consumers, and hope user generated content could boost their revenues from data.

We’re in discussions with top tier operators to do ‘Mobile Bebo’ with us, but we haven’t made a decision on which partners we want to go with yet,” Jim Scheinman, the site’s VP of business development and sales, told E-consultancy.

It’s about having the functionality of Bebo on the phone, but not having the full Bebo experience on the phone. I think it will probably be [launched in] Q1 next year.

Bebo, which has 27m users worldwide, recently overhauled its video service, Bebo TV – which Scheinman said would eventually be extended to mobile users.

Through the move, Bebo aims to take on the likes of YouTube and Google Video, as well as increasing its ad revenues by offering space on the channel for sponsored videos.

Scheinman said the ads formed part of the site’s ‘Engagement Marketing’ strategy:
Web 1.0 advertising is dead. If you look at Yahoo’s last quarterly numbers they’ve seen a decrease in graphical advertising when in fact online advertising has gone up. It’s not that people aren’t buying banners any more, it’s that they’re not core any more.

What we call Web 2.0 advertising or engagement marketing is all about great content. You have to have an engaged audience and the tools to enable that audience to spread messages virally. This is why you see stories about sites like Yahoo! offering sites like Facebook $1bn.

Scheinman added that Bebo was now “fleshing out” the details of its upcoming self-generated advertising strategy.