History repeats itself, again.
This morning I read an article in the NY Times about Twitter turning down an offer to be acquired for $500 million by Facebook. Now granted, it’s stock in Facebook and there are lots of questions about how Facebook is valued as well, but, according to Twitter, they are not making any money and have not figured out how to make money. And someone offers you $500M? It’s not like Twitter has any “secret sauce”. It’s a nice little utility feature for sending short messages to your friends. I follow a few people and again its a nice utility. And there are already a host of competitors.
This was the kicker from Twitter’s CEO -
“we haven’t studied the business cases much,” he said. “We literally have no business people in the company, so this isn’t an area we’re really focused on.”
Hmm, does anyone remember Pointcast in Web 1.0? Pointcast was this application that pulled news and other information from the web. According to Wikipedia, “in January 1997, News Corporation made an offer of $450 million to purchase the company.” 2.5 years later, they sold “for about $7 million in May 1999 to Launchpad Technologies” and the service was shut down soon after.
History does repeat itself.
Case in point – SixApart, parent company of TypePad and MovableType, just acquired Pownce, which is (was) a highly touted Twitter competitor. Price was undisclosed, which I assume means they were only interested in the tech team.