Google In Talks To Acquire Twitter

This is a repost of Michael Arrington's article on TechCrunch, dated April 2, 2009.

Here’s a heck of a rumor that we’ve sourced from two separate people close to the negotiations: Google is in late stage negotiations to acquire Twitter. We don’t know the price but can assume its well, well north of the $250 million valuation that they saw in their recent funding.

Twitter turned down an offer to be bought by Facebook just a few months ago for half a billion dollars, although that was based partially on overvalued Facebook stock. Google would be paying in cash and/or publicly valued stock, which is equivalent to cash. So whatever the final acquisition value might be, it can’t be compared apples-to-apples with the Facebook deal.

Why would Google want Twitter? We’ve been arguing for some time that Twitter’s real value is in search. It holds the keys to the best real time database and search engine on the Internet, and Google doesn’t even have a horse in the game. In a post last month called It’s Time To Start Thinking Of Twitter As A Search Engine, I wrote:

More and more people are starting to use Twitter to talk about brands in real time as they interact with them. And those brands want to know all about it, whether to respond individually (The W Hotel pestered me until I told them to just leave me alone), or simply gather the information to see what they’re doing right and what they’re doing wrong.

And all of it is discoverable at search.twitter.com, the search engine that Twitter acquired last summer.

People searching for news. Brands searching for feedback. That’s valuable stuff.

Twitter knows it, too. They’re going to build their business model on it. Forget small time payments from users for pro accounts and other features, all they have to do is keep growing the base and gather more and more of those emotional grunts. In aggregate it’s extremely valuable. And as Google has shown, search is vastly monetizable - somewhere around 40% of all online advertising revenue goes to ads on search listings today.

If this is accurate, it’s a brilliant deal for Google - the value of Twitter is only going to go up over time. And it will be Twitter founders Evan Williams and Biz Stone’s second sale to Google - they sold Blogger to them just five years ago. But there’s one big question - where’s Microsoft in all this? Letting Twitter go to Google only hurts them, badly, in the long term search game. This is an asset they need to be competing for aggressively.

Of course, it’ll be sad to see Twitter become just another subsidiary of Google, if this happens. I would have liked to have seen the company spread its wings a little longer to see what it could do.

Updated: Yet another source says the acquisition discussions are still fairly early stage, and the two companies are also considering working together on a Google real time search engine. But discussions between the companies are confirmed.

Update 2 (4/3/09): In a non-denial blog post entitled “Sometimes We Talk” Twitter co-Founder Biz Stone says: “It should come as no surprise that Twitter engages in discussions with other companies regularly and on a variety of subjects.”

Update 3: see here.

Tweet With Tweetie: The New Twitter Client For Mac

Over the past few weeks I have noticed that Twitter is beginning to gain momentum, here in Australia. It seems I see or hear the word Twitter at least a few times a day, either through Radio, Newspapers or in general conversation. However, given that Twitter in Australia is still kind of new, a lot of people may not know that there are programs that help manage your tweets, also known as Twitter clients. There are several Twitter clients available on the internet today, but it's hard to work out what one is the best to use.

Well, the decision may become easy when the new Twitter client named Tweetie becomes available on Apple Mac desktops on Monday 20th April.

TechCrunch managed to get their hands on an early build of the product and have provided a brief impression until a full review is conducted on Monday:

• The app deals with photos from sites like TwitPic perfectly - images pop up quickly in lightweight windows, without having to open a browser
• Sending images is also perfectly executed. Just drag and drop the image from your desktop to Tweetie’s new message field, and it does the rest.
• While there isn’t currently a way to get a Column view similar to TweetDeck’s, you can break out as many search panes as you’d like, each of which is treated as its own window (this is great for when you only need to keep track of a search term temporarily).
• As with Tweetie on the iPhone, it just feels so Mac. The icons do what you think they should, and there aren’t any extraneous text fields or buttons
• Global Hotkeys.

Tweetie will offer a free version that will be ad supported, as well as a paid ad-free version app for $14.95.

Main window, with popup TinyPic image at left

New message window in the foreground (activated with a global hotkey). Search and main windows in the background

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• Head-to-Head: TweetDeck vs Seesmic Desktop (mashable.com)
• Twitter integration for Adium in process (tuaw.com)

Twitter in Plain English

If you just don't understand what Twitter is and how it works. Watch this video. It couldn't be explained any better than this.