December 30, 2010 | In: Opinion

Why Google Will Never Buy Facebook

One of the very cool features that Google added a few months ago is Google Instant, which, although I really hated when I first used it, now I’m addicted to it (OK, addicted is not the word, but I like it a lot!), and I feel now that searching the old way (without instant suggestions) is tiresome, boring, and slow. Google instant makes my search a lot easier by suggesting the most common searches relevant to the characters I’m typing. Now what does this have anything to do with the title of this post?

Well, take a look at what I get when I type “Will Google b” in the Google search box while using Google instant:

Will Google b…uy Facebook?

We know from this search that a lot of people think that this might happen. Let’s analyze why these people think it’s possible:

- Facebook is currently valued at $33 billion, which is a lot of money, but is still money that Google can afford. After All, Google is sitting on $33.4 billion of cash.

- Google will want Facebook because they (Google) can serve extremely targeted ads to Facebook audience, after all, Facebook knows your age, your gender, your job, your education, your background, your interests, your ethnicity. Facebook has the potential to know absolutely everything about you (yet they are never good at targeting ads, something that Google can easily fix).

- If the current trend continues, Facebook is set to surpass Google as the #1 most visited website in the US and the world. That traffic is jaw dropping for Google, who will probably pay anything to get it.

- By buying Facebook, Google will gain full insight on nearly everyone’s browsing behavior and activities (which, as I will later explain, is more of a curse than a blessing).

Now after discussing the others’ point of view, here’s why I think Google will never buy Facebook:

- Although it’s valued at $33 billion, Facebook thinks of itself as worth more. I remember reading an article a few years ago (I can no longer find the link), where a Harvard professor rejected an offer by a company (can’t remember which company either, I feel like I’m spreading a rumor here :) ) to buy Facebook for $3 billion. Back then, in 2006-2007, the professor said that Facebook is worth $30 billion. So, when the market values Facebook at $30 billion, how much do you think that professor will give it a value?

- Facebook think that it can replicate Google adwords, and Google adsense. Although its current advertising is lame, Facebook can do very well if it can target the audience the same way that Google does, which is actually easier for Facebook: While Google jumps through hoops to profile its users (for targeted advertising), Facebook doesn’t need to; it already has all the information it needs about its users.

- The Microsoft factor: Microsoft owns about 1.3% of Facebook, while they don’t have a majority vote, their vote for sure will count when it comes down to selling Facebook to Google, and certainly they will not agree.

- Antitrust? If Google buys Facebook, I suspect many will feel that the Internet is no longer this independent body, and will probably start filing some antitrust lawsuits, or maybe start looking for alternatives for both Google and Facebook, or maybe only Facebook (which is much easier to reproduce than Google).

Google will never ever buy Facebook, it’s not in its interest, maybe they’ll try to compete with it from time to time (I suspect unsuccessfully, as they always did), but they’ll never buy it. And who knows if Facebook goes from strength to strength, or in a few years, we’ll have something better, and Facebook will become the next MySpace.

1 Response to Why Google Will Never Buy Facebook

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Facebook Is Set to Overtake Google by April of 2011 « Fadi El-Eter

January 20th, 2011 at 12:33 pm

[...] ads are welcome by users (unlike the irrelevant game ads that we still see from time to time). As I mentioned before, Facebook has an advantage over Google when it comes to analyzing a person’s profile (they [...]

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