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  • Will Apple Buy Facebook?

    Sometimes rumors are so crazy that they just might be true.

    Vague but pointed remarks by Steve Jobs during his surprise appearance on the Apple conference call has led to some speculation that Apple may be considering buying - of all things - Facebook. Peter Kafka at the Wall Street Journal's All Things D blog points out that Apple has a whopping $51 billion in the bank and that they could afford to buy the social networking giant when it goes public.

    When asked yesterday on the earnings call why Apple shouldn't return some of its huge pile of cash to shareholders in the form of dividends, Jobs replied as follows:

    We strongly believe that one or more very strategic opportunities may come along, that we are in a unique position to take advantage of because of our strong cash position. You know, we've demonstrated a strong track record of being very disciplined with the use of our cash. We don't let it burn a hole in our pocket, we don't allow it to motivate us to do stupid acquisitions. And so I think that we'd like to continue to keep our powder dry, because we do feel that there are one or more strategic opportunities in the future. That's the biggest reason.
    Kafka has no inside information suggesting that the "strategic opportunities" include buying Facebook, but he lists the benefits of the acquisition to Apple. First and foremost, Apple can afford it. Facebook is still privately held by Mark Zuckerberg and associates, and has grown from a Harvard-only version of Hot or Not in 2003 to become a company that will have an estimated market value of $35 to $40 billion US when they go public, supposedly next year. Apple could easily cover that and still have money left over to buy a record label or TV studio or two. Secondly, there is the matter of Facebook's enormous user base: half a billion people, or one out of every fourteen humans on the planet Earth, has a Facebook page. Each one of these would presumably gain iTunes and FaceTime accounts, giving Apple unquestioned dominance in online music and video chat. Apple and Facebook aren't currently competing in any realm, but both are competing with Google, and it's probably worth a very large sum of money to Steve Jobs to be able to jab a stick in Eric Schmidt's eye.

    Additionally, there's significant synergy. The Facebook app for iPhone has been estimated to be one of the most used apps on the iPhone, with over 100 million active monthly users. David Kirkpatrick, author of The Facebook Effect, claims that he has heard from "someone who thought he knew the data that more than half of all usage of the iPhone of apps, other than those provided by the phone itself like telephony and email, is coming from Facebook."

    It's pure speculation, again, so it's wise to not put a whole lot of stock in these rumors. On the other hand, there was word last week that Steve Jobs had Mark Zuckerberg over for dinner. There have been no reports on what they discussed at the supposed meeting, but many speculated that it had to do with Facebook-Ping integration. It would be very interesting if the "integration" they were talking about was at a very different level.

    Source: TUAW
    This article was originally published in forum thread: Will Apple Buy Facebook? started by Paul Daniel Ash View original post
    Comments 76 Comments
    1. slavipz's Avatar
      slavipz -
      I doubt that Mark would agree with Apple buy Facebook... and it is really a stupid rumor only... wait and you will see that i'm right
    1. F3nom3ni's Avatar
      F3nom3ni -
      I don't see what huge benefits apple would get by buying facebook.
    1. njp316's Avatar
      njp316 -
      Quote Originally Posted by F3nom3ni View Post
      I don't see what huge benefits apple would get by buying facebook.
      The same thing Facebook uses to make millions. Your personal data
    1. Snozberries's Avatar
      Snozberries -
      Quote Originally Posted by hollow0 View Post
      Not gonna happen. It's just some silly rumor someone made up. Steve and Mark most likely talked about Ping and how to integrate that with Facebook.

      This rumor is based on someones thoughts on what Apples' strategic move should be since they have a large amount of cash. Not real facts about what they will do.
      Maybe Steve Jobs killed Mark Zman and replaced him with a Borg or maybe he just assimilated him ... (like on Star Trek!!)
      (steven hawking voice) yes mr jobs, that would be a great idea, idea, idea, idea...
    1. skizo's Avatar
      skizo -
      Will Apple Buy Facebook?
      No, no it won't.
    1. Snozberries's Avatar
      Snozberries -
      Quote Originally Posted by raduga View Post
      When you login, geohot gets friended automagically
      lmao! he'd "disappear" automagically for a bit too =]
    1. quidam_brujah's Avatar
      quidam_brujah -
      Quote Originally Posted by iLaw-One View Post
      Apple would most certainly redesign it (FB) if indeed they acquire it and I bet the user experience would be just awesome!!
      +1 on that: FB UI has gotten progressively worse and what you see on the iPhone app never matches the webpage -- I have no idea where **** is half the time.

      Also, they are worth billions and not only can they not program a sensible FB iPhone app out of their ***, but no iPad HD app? Yes, they need some of the Apple design people to clean their **** up. And I strongly doubt the numbers are as high as 1:5 humans: no one has more than one account? Give me a break.
    1. mortopher's Avatar
      mortopher -
      Quote Originally Posted by sziklassy View Post
      I never understood the point of facebook, twitter, etc. I tried to be "trendy" and update my life on the net... frankly I found it a stupid waste of time.
      Facebook is most definitely a waste of time, but thankfully I have plenty of free time lately!

      Twitter could be viewed as a much more productive tool though. Yes, there are a lot of teens and hipsters that will tweet practically everything they do in their daily routine, but there's also an entirely different side of twitter as well. I use both applications, but I enjoy Twitter a whole lot more. I use it almost like a newsfeed rather than a means of 2way communication. I have a small handful of "real life" friends on twitter but the majority of the people I follow are either comedians ( @thesulk, @shitmydadsays, @craigyferg, etc.) or people in certain fields that I am very interested in @musclenerd, @ericschmidt, @kevinrose, @billgates, etc.). Surprisingly enough, @Alyssa_Milano is a very handy source for neat bits of tech info.

      I apologize for derailing the thread momentarily.

      Back to the topic... I really have a tough time with the $35-$40 billion that they estimate FBs value at. 500m accounts != 500m users... it drives me absolutely crazy when I hear the media saying a half of a billion people use FaceBook... I think once they go open and true numbers are revealed, the value of the company will be significantly lower than currently speculation suggests. Regardless of what the true value of the company is, I don't see how anyone will be able to justify spending enough to buy the company (or at least the majority of the shares), without exploiting the wealth of info on FB in a "evil" way.
    1. CynicalDriver's Avatar
      CynicalDriver -
      I can't see this happening. Apple already has a social network chassis in production with Ping, which just needs people to use it. Ping will eventually take off.

      Between the iPhone, iPad, iPod, and all the extras for them, Apple made billions.

      Look for their next project to have the same potential. Facebook just doesn't have it. It's like gold, the time to buy it was 6 years ago, now is actually the time to sell it.

      Facebook is on top, with only one way to go. That down-trend could be triggered by a new site tomorrow. Internet services almost never recover after they hit bottom: AOL, Excite, Napster, ICQ, Yahoo is in denial, Myspace, Angelfire, etc...

      To take advantage, you have to buy early, like Google did with YouTube, and Microsoft did with Internet Explorer technology.

      No, Apple is not going to buy Facebook. That ship sailed already.
    1. mortopher's Avatar
      mortopher -
      ^AOL and Yahoo are both doing just fine and are still pulling in multi-billion dollar revenues.
    1. CynicalDriver's Avatar
      CynicalDriver -
      Compare that to what they used to male.

      50 billion is too large of an investment/return gamble with Facebook.

      And for the record, I haven't used Yahoo in YEARS. I don't know anyone who still uses it, except for the utterly over-bloated messenger. Facebook did claim a large share of the messenger world, because people don't usually carry on long in-depth conversations online, now people could catch up with a bunch of friend's quickly, rather than devoting "chat times" to them.

      The .com bubble burst for a reason, and blind trust that these things will last was that reason. Apple doesn't tend to be that short sighted.

      One thing that Apple COULD do, is buy a cellular provider, which would provide a captive customer base for the iProducts, and built-in cellular cards in MacBooks. THAT would be a good way to invest the money, long term returns, with no foreseeable end.
    1. CynicalDriver's Avatar
      CynicalDriver -
      What they used to make*
    1. babyydaveyy's Avatar
      babyydaveyy -
      LMAO if apple bought facebook, the layout and everything would just turn into some kind of variation of the iOS. and does anybody else find it halarious that steve jobs had mark zuckerberg over for dinner...
    1. mortopher's Avatar
      mortopher -
      Quote Originally Posted by babyydaveyy View Post
      does anybody else find it halarious that steve jobs had mark zuckerberg over for dinner...
    1. Captinsmooth's Avatar
      Captinsmooth -
      Facetime and Facebook coincidence I think not...lol
    1. mi1knc0okies's Avatar
      mi1knc0okies -
      when myspace got sold the site began to look a litte better but all the advertising got annoying.