Twitter Inc (NYSE:TWTR) CEO Jack Dorsey isn’t suited to the job in the long term, and rumors about the future of the company have swirled as a result. One of the most likely solutions, says the throng of Wall Street, is that Google Inc (NASDAQ:GOOG), (NASDAQ:GOOGL) and Facebook Inc (NASDAQ:FB) will fight each other to buy the firm. Now a much odder rumor has emerged.
Chatter on the street on Wednesday, which is the least reliable source possible, informed DAMS Consulting that Google and Facebook were going to take Twitter and split it between them. Whether that means taking a part of the firm each, or actually pulling it apart, remains to be seen.
Google, Facebook pulling Twitter apart
It’s clear that both of those solutions are almost unworkable, but stranger things have happened in the tech world. Getting the right sort of agreement in place could allow Google and Facebook to form an uneasy Joint Venture that would hold Twitter between them, but pulling the firm apart sounds much more interesting.
There isn’t much in Twitter to begin with, and the only real way to pull it apart would be to separate the core of the product from all of the extras that Dick Costolo added to the firm during his tenure. Video is the key part of that and Periscope and Vine could form one half of the Twitter that Google and Facebook would want to pull apart.
It is possible that Facebook, which has big ideas in the video world, would take those parts of Twitter and let Google have the core product. Jim Cramer says that Google should buy Twitter in order to create a new type of live experience.
It’s not likely, though. The only thing that’s going to drive a high price at Twitter Inc is that the firm has assets that neither Facebook or Google want the other to have.
Twitter might be no-man’s-land
Tech firms aren’t averse to working together to avoid negatives in their industry, but they don’t like giving other firm’s advantages. During World War One the area between the static defensive lines of each side was called “no man’s land” Google and Facebook may try to turn Twitter into their very own fortified neutral zone.
A joint venture between the firms, with each holding say 49% and the final 2% in the hands of Jack Dorsey or another neutral tie-breaker, might kill Twitter, but it would allow the firms to veto each other’s attempts to use the firm to take ground in the market.
World War One was bad all around, but the biggest loser was the farmer that owned no-man’s land. He lost his living for four years and came back to barbed wire, trenches and unexploded shells.The village of Douaumont is still uninhabitable 100 years later. Twitter’s fate might be the same if it is divided up by Facebook and Google.
Splitting up Twitter is an inelegant solution and it’s more likely to cause trouble than it is to be worth it. In the game of chess that the tech market is turning into, it may be the only solution that’s possible as Google and Facebook both try to limit each other’s moves.