Chatter about a possible Twitter acquisition went into high gear Friday after CNBC reported that both Google and Salesforce are weighing to make an offer for the company. There are still doubts whether any of this will come together quickly — Twitter’s board may be asking for up to $30 billion, according to a Recode report.
But the interest seems to be real, and the price tag is poised to go down if Twitter continues to struggle with some of its key growth metrics. Which brings us to the question: Why would anyone want to buy a company like Twitter?
Turns out that there are plenty of good reasons, especially for a suitor like Google. And not all of them are terribly obvious.
Mobile social. Okay, this one is a no-brainer — sort of. Google has long struggled with its social strategy. Not only did Google+ never become anything close to a viable Facebook competitor, Google’s singular focus on Google+ also led to the company missing the success of media-centric mobile social networking like Instagram and Snapchat.
Acquiring Twitter could give Google the foundation to start over on social, and use it as a launchpad for a modern mobile social service that doesn’t look like Facebook circa 2010. Plus, a new owner would have a lot more leeway than Twitter’s current leadership to innovate.
That’s because Google wouldn’t be beholden to the protectionism that has made it so hard for Twitter’s leadership to change core concepts of its service. Instead, the company could strike a kind of bargain for a fresh start and, for example, also give Twitter’s user base those long-overdue anti-harassment tools.
Customer relations. This one is a bit less obvious. Twitter is already being used by countless big brands and small businesses alike to engage with their customers. Those relationships are increasingly valuable to Google, especially as consumers migrate from search to messaging and smart assistants.
Facebook knows this very well, which is why it is actively targeting businesses with its Messenger platform. Google is playing catch-up in this space, but it may even be able to leapfrog Facebook if it integrated Twitter with its own assistant. In a scenario like this, consumers could ask a company questions about their products from Google Home, the company’s upcoming smart speaker, its new Allo messenger or Twitter’s mobile app — and a company would field all those inquiries through the same interface, automatically replying to some and manually answering others.
Live video. This is another area where Google is playing catch-up with Facebook. Sure, YouTube has had live video for years, but Facebook Live has gotten a lot more attention from media and consumers alike. Twitter’s Periscope has felt that squeeze as well, but the company managed to recover with a flurry of live streaming deals, most notably for Thursday Night Football. Google could use some of that momentum to stay relevant in the live video space, and Periscope’s team could help the company continue to innovate in the mobile streaming space.
Advertising. Another no-brainer. For all of its struggles, Twitter has built a fairly solid ad business, to the tune of $535 million for the most recent quarter. And Twitter has just begun to monetize some of its assets, including video, where the company recently introduced an aggressive revenue-sharing deal. Google knows how to sell ads, and could help Twitter realize its full potential in this space.
Developer tools. One of Twitter’s most-overlooked assets is Fabric, its collection of mobile developer tools. Fabric helps mobile app developers with anything from analytics to monetization, and it is being in use in more than two billion installed apps. Spotify, Tinder, Ebay and Pandora are just some of its higher-profile users.
Tools like this are great for Google because they can make it easier for developers to build apps for phones running the company’s Android operating system. But more importantly, it would also offer Google a huge opportunity to get a foothold in apps installed on hundreds of millions of iPhones, giving the company a chance to make money even if consumers decide to buy a phone built by Apple.