Why Apple Won't Buy Twitter

Apple (AAPL) is one of the companies that’s reportedly been sniffing around Twitter, the hot S.F. startup du jour. But unless Apple is planning to significantly shift its Internet focus, it makes zero sense for Apple to buy Twitter.

Why not?

  • Apple sells computers, gadgets, and software. Owning an unprofitable messaging service will not help Apple sell more computers or gadgets. Apple is already maximizing its Twitter halo with zero cost. (And if Apple wanted to build services on Twitter’s back, that’s what the API is for.)
  • One argument we’ve seen is that because Twitter’s team has built one good Web service, it might be able to help Apple make better Web services. Last we checked, the Twitter guys wanted to build Twitter — not some other Web service for someone else.
  • And anyway, if the cofounders each cash out several million dollars (tens of millions?) from a deal, they are hardly going to want to build Web stuff for Apple.
  • It doesn’t fit the pattern of Apple acquisitions, which have all strengthened Apple’s core business, not taken it into vastly different markets. For instance, P.A. Semi, which will help Apple build better chips to sell more gadgets.
  • Sure, Apple has a ridiculously huge cash pile. But it’s not going to be able to get the best deal for Twitter. Internet companies like Google and Microsoft — which are actually in the same business as Twitter — would make Apple overpay, or more likely, would outbid. That doesn’t seem like something Apple would get excited about.

Does it make sense that people from Apple should be friendly with people from Twitter? Absolutely. Does it make sense for Apple to own Twitter? Not as far as we can tell.

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