Kara Swisher at Boomtown claims to have a scoop from “many sources with knowledge of the situation” that Google and Microsoft are battling for a search advertising deal with Twitter. Swisher recently dispelled rumors that Google was close to acquiring Twitter, but the “talks” that the two companies were in could have easily been regarding something like this.
Kara Swisher
It makes sense that Microsoft would be involved too. They did get Facebook (in the US). Henry Blodget at Silicon Alley Insider seems to favor Microsoft getting the deal. He writes:
The chosen “partner” will presumably be given the exclusive right to put search ads on Twitter’s pages. If Microsoft behaves the way it usually does in these situations, it will pay whatever it takes to “win” the deal. Google, meanwhile, still smarting from getting taken to the cleaners on a disappointing MySpace deal, will probably be gun shy.
So Twitter will do its best to persuade Microsoft that Google is willing to break the bank, and Google probably won’t do anything to discourage that spin. And, in the end, Microsoft will probably be the one to break the bank and “win” a big exclusive search deal with bad economics.
Swisher says her sources indicate that Twitter will begin several weeks of “testing” search ads with one of the companies first. Whether such testing could potentially lead to an acquisition remains to be seen, but perhaps the prospect of a search advertising deal will calm down the talk of an all out acquisition for the time being.
