Facebook recently made a US$500 million offer to buy micro-blogging site Twitter, according to a Wall St Journal website.
AllThingsD reported Monday morning in the US that acquisition talks held between the two companies recently fell through. The deal would have been for US$500 million in Facebook stock.
So far Facebook has only acquired one company, Firefox co-founder Blake Ross's Parakey.
Twitter's a different story. The microblogging service competes directly with Facebook's own "status" feature, to the point where many Twitter users have configured their Facebook statuses to display their Twitter statuses. It's also, after Facebook, the most-hyped company to come out of the Bay Area in the past five years.
The two also have a moderate connection: early Twitter investor Marc Andreessen sits on Facebook's board.
The problem with the proposed Facebook acquisition was that, according to AllThingsD, Twitter's executives and investors thought it would be better for the company to come up with its own business model rather than sell out this early.
Plus, in addition to the "typical concerns about integration and costs", Twitter reportedly was concerned about what that "US$500 million in stock" really meant, given that Facebook's paper valuation is significantly different than the US$15 billion "preferred" valuation at which Microsoft invested US$240 million last year.
