The rumours had been around for sometime now that Yahoo! was going to acquire Facebook. According to BusinessWeekOnline.com, Yahoo! initially offered Facebook $1.4 billion dollars. This, was because of the resounding success of MySpace - be it about revenues through ads or promoting News Corp’s other businesses. MySpace is such a success story that it entered into a deal with Google for $900 million for placing ads (subject to some conditions).
Anyway, the ‘talks’ Yahoo! and Facebook broke down in July around the time Yahoo! shares lost 20% on the bourses (following Yahoo!’s revelation that new targeted ad tech would be delayed). However, the rumours have started again and WSJ reports that the two parties are now in serious talks with each other.
But is Facebook really worth $1 billion? Yes! With Facebook releasing its API recently, many welcomed it enthusiastically. However, whether Yahoo! can use Facebook as News Corp is using MySpace is a different story altogether.
