Without a doubt, Twitter was one of the success stories on the Web in 2007 as geeks around the world embraced the ability to communicate (and I use that word rather loosely) in 140-character bursts.
Putting the aside Twitter’s addictive-ness and utility (or lack thereof), an interesting question is whether Twitter is a stand-alone business or a service looking for a home.
The former seems difficult to envision given mobile advertising seems to be taking its sweet time to gain momentum, even though there are reports the global mobile ad market could hit $3-billion this year. And it’s hard to believe Twitter users will enthusiastically accept advertising as they pound away on their 140-character missives.
So leaves Twitter as a venture-backed M&A play looking for the right deal. Perhaps the most obvious candidate to buy Twitter is Facebook, which has an increasingly popular messaging platform that many people are using instead of e-mail. The addition of Twitter into this message system would provide a user-friendly mobile service to Facebook’s 58 million users.
As important, it would also give Facebook some much-needed strategic cache in the wake of the Beacon disaster. With $250-million of Microsoft cash in the bank, it is expected that Facebook will be making acquisitions this year so why not kick-start the process with the purchase of a high-profile start-up with a group of investors that includes Union Square Ventures, Charles River Ventures, Marc Andreessen, Dick Costolo, Ron Conway, and Naval Ravikant.
Twitter will be acquired this year; the question is who the buyer will be, and, from here, Facebook looks like the obvious choice.
Update: Center Networks wonders if Twitter is f*&?-ed because it doesn’t have a business model yet. Dave Winer provides his take on how Twitter can be monetized.
Update II: Maybe Facebook will buy Plaxo, suggests ValleyWag.
Technorati Tags: Facebook, Marc Andreessen, Twitter
7 Comments
Hi Mark,
I agree that Twitter is becoming a hot property and that its popularity is going to get the attention, if it hasn’t already, of many companies looking to add a messaging service to their existing product/service. Given the fast paced environment of the “Web 2.0″ market, I can see where your coming from in your argument that Twitter will be acquired. However, not so sure if it will be this year. Maybe they’re not looking for a quick exit and they’re looking to build the product?
-Chris
I guess it depends on how much someone is willing to offer Twitter’s founders and investors. If the right offer comes along, anything can be acquired.
Hey Mark; totally agree with you…we are seeing the expansion in platforms making the M&A market more product focused not revenue so Twitter looks good. The problem is that it will give off the scent that it is a “build it they will come market” which will lead to disappointment and bubble tendencies for other aspiring startups.
http://furrier.org/2008/01/02/twitters-goal-critical-mass-not-monetization/
Yuk, Facebook buy Twitter? I hope not, I would hate to have to delete my Twitter account. I can see Twitter being tasty purchase for a company though. Perhaps Google so they can inject Adwords?
Chris: Facebook was the most obvious name that came to mind but I wonder who else would be interested. Google is intriguing given its interest in the wireless market. Perhaps Microsoft or Yahoo given they’re both big players in the messaging market?
Google passed on Twitter when they bought their smaller competitor Jaiku. Why would they buy it now?
Hey Mark,
Yahoo is possible but I see the most synergy with AOL (though who knows if AOL could muster the M/A reserves for it)
http://www.leveragingideas.com/2008/01/02/who%e2%80%99s-going-to-buy-twitter/
Sam
One Trackback
[...] Note 3: Mark Evans suggests a scenario of Facebook buying Twitter. I don’t see the benefit of this largely because Facebook would be harvesting its own demographic. [...]