Comcast Acquiring Social Networker Plaxo; $175 Million Range
This story was written by Joseph Weisenthal.
Comcast (NSDQ: CMCSA) has acquired social networker Plaxo. Terms of the deal were unannounced in a Plaxo blog post announcing the news, but both TechCrunch and Reuters put the price tag in the $175 million range.. Rumors of Plaxo's sale have been floating around for awhile, with several of the usual names getting bandied about as possible acquirers. One report had Plaxo seeking $100 million. Comcast and Plaxo have already been partners since early last year.
So what's the idea here? CEO Ben Golub explains: "Joining forces with Comcast is a real win for our customers, our investors, and our employees. Comcast has an exciting vision to bring the social media experience to mainstream consumers. Together, we will be able to help users connect with all the people they care about, across all of the devices they use, with all the media they love to consume, create, and share. This is also great news for the Internet industry at large, where Plaxo has been and will continue to be a strong advocate for opening up the Social Web We are developing an exciting roadmap with Comcast that includes socially enabling the media experience in places such as Comcast's high traffic portal (Comcast.net),CIM's popular interactive entertainment properties (such as Fancast and Fandango), and the television."
Comcast wants to make social networking services a more integral part of the media/communications services it offers to users. Makes some sense: ISPs have offered email for awhile, so why stop there? The question is whether Comcast, which already has a reputation for being a bit spendthrift, can convince investors that this actually makes sense and that it's not just throwing money at the latest trend. On the other hand, at $175 million, it's not huge (relatively) or transformational.
The company has had a bit of a rocky road. In its early days, its alert notices flooded peoples' inboxes, giving it the reputation of a spammer. It's since made amends, positioning itself as a social networking utility, that helps users manage their connections across a variety of networking services. The company has raised over $20 million from investors including Sequoia, Globespan, Ram Shriram and Tim Koogle. More to come
By Joseph Weisenthal