updated 04:30 pm EST, Fri December 10, 2010
Microsoft and Twitter execs have mystery talk
Microsoft CEO Steve Ballmer and his Twitter counterpart Dick Costolo were reportedly seen today having breakfast and have sparked rumors that Microsoft might acquire or land a deal with Twitter. The nature of the discussion wasn't known, but the two companies have both declined comment, hinting that it was business and not simply a personal discussion. It's unknown by the Forbes witness how often the two have met.
The news has followed just a day after Microsoft's Senior Director of Corporate Strategy and Acquisitions, Fritz Lanman, confirmed at the LeWeb conference that Ballmer had tried to buy Facebook in 2007. He had offered as much as $15 billion and developed an in-stages plan to buy the company that would have addressed Facebook founder Mark Zuckerberg's desire to keep control. Zuckerberg had eventually turned it down and only agreed to a $240 million stake that let Microsoft get a search deal.
The Windows developer has been one of the larger advocates of Twitter, building it into the Xbox 360 Dashboard and getting official apps for the Zune HD and Windows Phone 7. While mainly a feature addition on these platforms, an acquisition could lead to direct integration into the software itself and would very likely be used as leverage against Google. The latter indexes Twitter searches but could both lose that feature and see a more advanced version of it in Bing.
Microsoft might also be keen to integrate Zune features into Twitter's in-line media support and could downplay iTunes or other directly competitive rivals in such a case.
Twitter, simultaneously, has only just recently been generating revenue through sponsored trends and updates, and it may be looking to get financial security. Costolo was at one point an advertising product manager at Google.