Tuesday, March 28, 2006

Facebook's on the Block

"Facebook, the Web site where students around the world socialize and swap information, has put itself on the block, BusinessWeek Online has learned. The owners of the privately held company have turned down a $750 million offer and hope to fetch as much as $2 billion in a sale, senior industry executives familiar with the matter say.

That may sound like a huge amount of money, especially when you consider that the company was launched just two years ago by a group of sophomores at Harvard University, led by Mark Zuckerberg (see BW Online, 'Under 30, On the Cutting Edge'). But already, www.facebook.com has become the seventh-most heavily trafficked site on the Internet, according to market researcher comScore Media Metrix. It racked up 5.5 billion page views during the month of February, the latest month for which complete data are available. That's more page views than the Web sites of Amazon.com (AMZN ), Ask.com, or Walt Disney (DIS ).

GOOD FIT. It's not clear who would be willing or able to pay that much. Industry analysts think that Facebook might be a good match for Viacom (VIA ), which owns the MTV, VH1, and Comedy Central cable networks. 'I think Facebook would be a great strategic fit for Viacom,' says Troy Young, executive vice-president and chief experience architect at Organic, an online advertising and consulting firm. 'Viacom has people working on social networking. But I think they need to demonstrate to the market, through a major acquisition, that they are on top of the youth marketplace,' Young said. Viacom declined comment. Facebook executives weren't immediately available for comment.

A Facebook deal would help Viacom founder and Executive Chairman Sumner Redstone fend off a growing challenge from News Corp. "

No comments: