Facebook sale rumor false; confirmed by spokesman
Daniel Silva
Issue date: 4/14/06 Section: News
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Reports in the March 28 issue of BusinessWeek state the owners of Facebook are looking to sell the Web site for as much as $2 billion. According to this report, the privately-held company has already turned down a $750 million offer.
"The reports that Facebook is for sale are nothing but rumor, and we do not comment on rumor," said Chris Hughes, a spokesperson for Facebook told The Triangle.
Facebook was started two years ago by a group of sophomores at Harvard University, led by Mark Zuckerberg. It is now the seventh-most heavily trafficked Web site on the Internet.
The most likely potential buyer thus far is Viacom, a media conglomerate that counts among its possessions the MTV, VH1 and Comedy Central cable networks.
"We are certainly exploring online social networking; it's the type of business that's well aligned with the interests of our key audiences," said Jeremy Zweig, Viacom's vice president of corporate relations. "It's a rapidly evolving model, there are a lot of new players, and we can definitely see ourselves building or buying a social networking business that incorporates user-generated content."
There is still speculation as to whether Facebook's owners can fetch the asking price for their Web site.
"I don't know if they'll be able to get that much, but they must assume that there is potential revenue from advertising," said Stephen Joyce, an instructor in economics at the LeBow College of Business. "Now, I don't know if they're inflating their price a little bit. Sometimes it's a common practice to say you want a real lot so that when people cut down your price, they knock it down to a level you can live with."
Only last year, rival social network MySpace.com, which commands a much larger user population, was bought by News Corp. for $580 million. In February, MySpace had 37.3 million visitors. It was also ranked the second-most trafficked Web site after Yahoo, according to Business Week. MySpace appeals to a much broader user base than Facebook by accepting all users and not just students.
"The reports that Facebook is for sale are nothing but rumor, and we do not comment on rumor," said Chris Hughes, a spokesperson for Facebook told The Triangle.
Facebook was started two years ago by a group of sophomores at Harvard University, led by Mark Zuckerberg. It is now the seventh-most heavily trafficked Web site on the Internet.
The most likely potential buyer thus far is Viacom, a media conglomerate that counts among its possessions the MTV, VH1 and Comedy Central cable networks.
"We are certainly exploring online social networking; it's the type of business that's well aligned with the interests of our key audiences," said Jeremy Zweig, Viacom's vice president of corporate relations. "It's a rapidly evolving model, there are a lot of new players, and we can definitely see ourselves building or buying a social networking business that incorporates user-generated content."
There is still speculation as to whether Facebook's owners can fetch the asking price for their Web site.
"I don't know if they'll be able to get that much, but they must assume that there is potential revenue from advertising," said Stephen Joyce, an instructor in economics at the LeBow College of Business. "Now, I don't know if they're inflating their price a little bit. Sometimes it's a common practice to say you want a real lot so that when people cut down your price, they knock it down to a level you can live with."
Only last year, rival social network MySpace.com, which commands a much larger user population, was bought by News Corp. for $580 million. In February, MySpace had 37.3 million visitors. It was also ranked the second-most trafficked Web site after Yahoo, according to Business Week. MySpace appeals to a much broader user base than Facebook by accepting all users and not just students.
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