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Yahoo! to buy Facebook?

After all this talk about keeping the company independent, I guess money talks for Mr. Zuckerberg as Yahoo and Facebook may approach a deal worth $1 billion. Apparently Microsoft and Viacom failed to reach a deal with Facebook, but Yahoo seems desperate to attract the younger generation and will pay any price to own the coveted youth market held by Facebook.

Implications... ever since Newscorp's acquisition of MySpace, the social networking market may be saturated enough for giant media companies to snatch the most popular social networking sites. There are many social networking sites popping up every week, but only few of these sites become successful. For example, there are many different sites that offer to share video (i.e. YouTube, Google, dailymotion, AOL, etc), but users keep returning to YouTube and Google. Almost all social networking sites have the same features, so what sets them apart? Branding and marketing. Facebook was successful because it built on established networks of colleges and universities. MySpace was successful because its foundation was in sharing music. YouTube became successful because it offered a relatively easy way to store and share video content.

It'll be interesting to see if Yahoo! actually succeeds in buying Facebook as the popular social networking site claims it is worth $2 billion. If the rumors of $1 billion are true, then maybe that wasn't a preposterous estimate.

posted by Koh @ 12:19 PM