Acquisition Talks Between Facebook And Twitter Break Down — So, Twitter still believes it can figure out how to generate some revenues. Kara Swisher is reporting that the rumors about Facebook acquiring Twitter were not only true, but that talks between the microblogging company and the social-network site broke down three weeks ago. The social net was offering to acquire the company for $500 million of its stock, but Twitter execs and investors apparently believe the company should “take a shot” at building revenues “as well as it [has] done building its growth” and not just jump at the first chance it gets to sell the business. Of course, there was also the matter of price—or, in this case, is half-a-billion dollars worth of Facebook stock really worth half-a-billion dollars? Facebook was pricing the transaction based on its own $15 billion valuation following Microsoft’s investment in it. But Twitter believed a more accurate valuation was $5 billion, making the deal worth $150 million.
Random House To Double Size Of Its Digital Book Catalog — With consumers pulling back on in-store book purchases lately, Random House may be picking a good time to ramp up its ebooks offering. The publisher is expected to increase the number of ebook titles it has to 15,000 from the current 8,000, the LAT reports. Although ebooks represent just 1 percent of total book sales, that could change as both publishers and consumers adjust their habits in the current economic climate. Wider adoption of e-readers like Amazon’s Kindle could help too, although the dismal financial picture could depress growth there as well. Matt Shatz, Random House’s VP for digital operations, is crediting the Kindle with driving ebook sales’ growth by triple-digit percentages this year. He declined to offer the LAT any specific figures, indicating that the revenues and sales units are still comparatively small.
Xing CEO Logs Out, Replacement Coming From eBay — LinkedIn rival Xing’s founder and CEO Lars Hinrichs has stepped down from the post to concentrate on “new entrepreneurial challenges”, and is being replaced by Dr. Stefan Gross-Selbeck, eBay’s general manager for Germany. But Hinrichs remains on the company’s board and remains its largest shareholder, he confirmed on his blog. No further info given behind the CEO swap. Under Hinrichs, Xing has tried to scale up to fight LinkedIn by buying smaller, country-specific European business networks – its acquisitions in Spain and Turkey totalling EUR 14 million ($17.6 million). On its home ground in Europe, it’s beating LinkedIn.
Social Networking Services Growing, Advertising Not So Much — The use of social networking sites will continue to grow, but advertising will not necessarily expand along with it, according to market research firm IDC. Framingham, Mass.-based IDC says in a new study that social networks will face slow ad sales until they can get users to do more than just keep up with friends. That’s because members of social networks such as Facebook, MySpace and Bebo tend to click on ads less than the U.S. Internet users overall.
AdBrite Launches CPC Auction For Banner Ads — Marking a significant departure from traditional CPM-based advertising, ad exchange AdBrite has launched a cost-per-click auction for graphical banner ads. When direct-response advertisers pay on a CPM or per- impression basis, they assume the full risk of impressions that may never convert into clicks or sales. AdBrite advertisers can now pay for graphical banner advertising in the same way they pay for search placements and text ads–paying only when their ad is clicked.
EMarketer Revises ’09 Forecast Down Again — In yet another sign that “the industry needs to completely rethink display ads,” eMarketer has revised its online advertising outlook for 2009 down again, cutting its forecast to $25.7 billion, from $28.4 billion. Six months ago, the online industry research aggregator forecast that online spending would total $30 billion. That figure has now been cut twice. Meanwhile, Google should remain the biggest beneficiary of the 9% growth projected for 2009, down from 11% growth in 2008, as its search advertising system is widely believed to drive sales and conversions for marketers. In fact, eMarketer actually raised its search advertising estimate for next year to $12.3 billion next, up from its August estimate of $11.9 billion.
Google To Lay Off 10,000 — Google is reportedly preparing to lay off as many as 10,000 workers, according to sources at the blog Web Guild.
Hundreds of employees have already been laid off and there are reports that about 500 of them were recruiters for the search giant. In fact, this is
one of the reasons the company was able to meet Wall Street’s Q3 expectations, Web Guild claims. Google has clearly managed to get around
the SEC’s requirement that it publicly disclose layoffs by classifying close to 30% of its workforce as contract workers. According to SEC
documents, Google has 20,123 employees, but Web Guild claims the actual number is closer to 30,000. Many of these workers will be getting the boot. As Google co-founder Sergey Brin said, “There is no question that the number (of workers) is too high.”