Has Twitter spurned Facebook’s friend request?

24 Nov 2008

Social networking darling Twitter is understood to have knocked back Facebook’s all-stock bid of US$500m to buy the company.

It is understood that Facebook offered Twitter US$500m in stock, but questions over the actual value of that stock dissuaded Twitter’s management, led by Evan Williams, Jack Dorsey and Biz Stone.

Facebook was valued at US$15bn after Microsoft paid US$240m for a tiny 1.6pc sliver of the company.

It is also likely that Twitter – which has over six million users worldwide – has opted to build on its own business strategy for monetisation.

Early Twitter investor Mac Andreessen happens to also sit on Facebook’s board.

There is a lot of speculation surrounding Facebook’s future monetisation plans. The company’s decision in recent months to no longer pay for text messages to alert subscribers to tweets (Twitter posts) signalled a possible opportunity for mobile operators to do business with Twitter.

So far nothing has come to pass, but there has been talk of Twitter considering premium business accounts.

A straw poll by veteran blogger Guy Kawasaki found that 50pc of Twitter users would pay US$5 or more, if Twitter charged for the service.

By John Kennedy

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years