Facebook buying Plaxo?
Facebook is “one hundred percent” buying Plaxo, we've just heard from a source. — This follows a rumor previously published by Valleywag asserting that such a deal is underway. — While these types of rumors should be taken with more than a grain of salt …
Context & Ripple Effects
Plaxo has been shopping itself all year: it explored a sale to Xing back in June 2007, repositioned toward the social networking market that same month, and was formally put up for sale on January 2. Now a source tells VentureBeat that Facebook is "one hundred percent" the buyer, echoing a Valleywag rumor from earlier this month.
The claim remains just that — TechCrunch's same-day pickup flatly labels the merger rumors "false so far," and no party has confirmed anything. Still, the timing matters: Facebook spent early January absorbing Beacon backlash and Zuckerberg telling 60 Minutes an IPO is unlikely in 2008, so a cash-and-stock acquisition of a contact-sync company would be its most concrete strategic move of the new year.
First-order effects
- If the deal holds, Facebook buys the address-book sync layer underneath millions of non-Facebook contacts — directly useful while Beacon's privacy miscues have it rebuilding trust around how it handles user data.
Second-order effects
- A credible Facebook bid resets Plaxo's auction: Xing, which reportedly weighed acquiring Plaxo in June 2007, and any other suitors must either raise their offer or exit, lifting the price Plaxo can command.
Third-order effects
- If social networks keep acquiring contact-sync and address-book companies, ownership of the identity graph — who knows whom, across services — becomes an asset class in itself rather than a feature.
The trend: Social networking platforms are consolidating control of the contact and address-book layer, treating shared identity data as core infrastructure worth acquiring outright.