Is Twitter really considering a buyout?

Anne Freier | September 9, 2016

Mobile Advertising

It appears that Twitter may be discussing an option to sell. Indeed, there’s been mounting speculation on a potential takeover of the social media company in recent months and though CEO Jack Dorsey rejected such claims, a sale may not have been entirely ruled out.
According to a BI Intelligence briefing, the company has been burdened by weaker user growth. Strong competitors such as Snapchat have been eating into its audience share and Facebook isn’t easily battled either.
Twitter monthly active user growth stalling
Screen shot 2016-09-08 at 5.02.11 PM
Though Twitter may not sell the company as such, it could be considering a sale of its assets such as Vine. Indeed, the company also appears to be considering a sale of mobile advertising server and exchange MoPub.
But who are the potential suitors? It turns out telcos, private equity groups and media firms such as News Corp could be among them. Recode reports that Google may consider an acquisition in line with an Alphabet media spin-off.
However, the high price of the company, rumoured to come in at $18bn, may repel many of the likely suitors.
There are some good reasons why Twitter may be a worthy investment though. It’s popular among big influencers and famous personalities who tweet regularly to entice their own followers. In addition, Twitter opened up Vine and Periscope for its Amplify advertising product which came as a more favourable revenue proposition among creators. In addition, it rolled out Moments for users.
Similar to Facebook, Twitter wants to be a destination for live events experienced in real time. Often news stories are broken on the platform and tend to spread fast across its many users. Twitter has suggested an integration to make breaking news stories a more dominant feature on its platform.
Let’s also not forget the company’s relationships with top media partners including many TV networks to stream NFL games, Wimbledon and the English Premier League live.
In addition, it has some good ad assets with more top brands using Twitter to advertise than any other social media platform according to a July report from Simply Measured.

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