Facebook’s Strategy for Acquiring FriendFeed

TechCrunch broke the news today that Facebook is acquiring the wonderful site FriendFeed.  There were few cues in either the official Facebook press release or the press release from FriendFeed.

The following is what’s clear to date:

Facebook’s Strategy for Acquiring FriendFeed

August 10, 2009 • Posted in: Facebook, Strategy
  • jgold918

    Facebook is built upon social interactions on non-serious issues. If they want to really become a centerpoint of the web, they need to become a more central source for all information. Friendfeed could position them better to gain a larger market share of homepages (first page people go to on the web) – which would seem to be a very valuable position.

    Now, I am not exactly sure why they would need to own friendfeed for this and what will happen when the next great friendfeed (or digg or ….) comes through – are they going to buy everything? I suppose they probably have enough cash and these little companies cannot cost too much to buy. The best argument I can come up with is that if it is going to be a core part of the position, you have to own it – otherwise you can eventually run into a holdup problem.

    Separately, I do not buy that the idea that this is a purchase to gain access to friendfeed's engineering prowess. The guys who started friendfeed could have gone to facebook right after google, but chose to start their own thing. Seem like serial entrepreneurs – I bet they leave as soon as their contract period ends.

  • jgold918

    Facebook is built upon social interactions on non-serious issues. If they want to really become a centerpoint of the web, they need to become a more central source for all information. Friendfeed could position them better to gain a larger market share of homepages (first page people go to on the web) – which would seem to be a very valuable position.

    Now, I am not exactly sure why they would need to own friendfeed for this and what will happen when the next great friendfeed (or digg or ….) comes through – are they going to buy everything? I suppose they probably have enough cash and these little companies cannot cost too much to buy. The best argument I can come up with is that if it is going to be a core part of the position, you have to own it – otherwise you can eventually run into a holdup problem.

    Separately, I do not buy that the idea that this is a purchase to gain access to friendfeed's engineering prowess. The guys who started friendfeed could have gone to facebook right after google, but chose to start their own thing. Seem like serial entrepreneurs – I bet they leave as soon as their contract period ends.