Verizon Buys Twitter
San Francisco, CA
March 28, 2008 — In a bold and unexpected move, Verizon Wireless announced this morning that it is acquiring the assets of Twitter, Inc. for an undisclosed sum. According to Verizon officials, the company intends to continue operating the popular messaging service under the Twitter brand indefinitely.
“We understand the magic that Twitter brings to its legions of fans,” said Lowell McAdam, CEO of Verizon Wireless, “and we have no intention of changing that experience. Our goal is to expand Twitter and bring this experience to a mass market of Verizon Wireless subscribers.”
Early reaction to the deal in the blogosphere was mixed, with many longtime Twitter users complaining bitterly that the move would spell the end of their beloved service. But more optimistic voices saw the beginnings of a possible shift towards radical innovation in the long-stagnant wireless data services arena.
As part of the arrangement, Twitter CEO Jack Dorsey will become a senior VP in Verizon Wireless’ consumer data services group, in addition to continuing to run Twitter, and will advise the company’s senior management on all online services. Industry analysts suspect this move heralds the start of a major shift in Verizon’s approach to its online services, coming on the heels of its recent announcement that its network will open up to 3rd party devices. The role of Twitter co-founder and Obvious CEO Evan Williams was unclear as this article went to press.
Sources inside Verizon confirm that several major consumer data initiatives, including a pending deployment of network address book (NAB) services, have been put on hold, apparently in conjunction with the deal. But those same sources were quick to dismiss the suggestion that the deal was a reaction to T-Mobile USA’s myFaves initiative: “myFaves was not even a consideration,” in the deal, said one insider.
The deal comes just a few months after Google announced the acquisition of a similar service called Jaiku. The acquisition of Twitter is also widely seen as a vindication of the controversial VC investment by Fred Wilson at Union Square Ventures, who famously declared on his blog that he didn’t know precisely what business model would emerge from Twitter to justify the investment.
At Twitter headquarters in San Francisco, employees were uneasy about rumors of a possible consolidation into Verizon’s facilities in Walnut Creek, CA although company officials denied the possibility of such a move.
(Disclosure: I have no inside information about any of this stuff. I just woke up too early this morning.)
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