Facebook Buys FriendFeed

So, I take a couple days off and Facebook buys FriendFeed. A bit ironic considering there hasn’t been much to discuss lately.

Chet cordially invited me to comment on the acquisition, and even though I planned to anyway, let’s just give him credit for being the tipster.

Image by nestor galina from Flickr used under Creative Commons

Image by nestor galina from Flickr used under Creative Commons

There certainly hasn’t been a shortage of coverage and analysis of the deal, just check Techmeme if you haven’t read any yet. As expected, the reaction of FriendFeed’s core users, early adopter types, ranges from uneasy to downright up-in-arms.

Why? Well, pick a reason. The acquisition was talent, not product, leaving the FriendFeed service and its API on life-support. Sure, they’re running now, but there are no indications that Facebook will keep it running just to placate its few (in comparison to Facebook) users.

The FriendFeed team is a group of rockstars who took Facebook’s News Feed and applied it to the entire interwebs. They’ve built a great app and rolled out awesome features at an astonishing rate. Many of their features have been borrowed by Facebook to enhance the News Feed, and it seems logical that Facebook will use this talented group to bolster its R&D.

So, let’s talk about winners and losers.Winners
Obviously, the FriendFeed team wins. FriendFeed, despite the great feature set, didn’t drive much traffic and didn’t have any obvious path to revenue. That’s not a requirement (see Twitter), but so few people used FriendFeed that they didn’t even have the rampant speculation about their lack of business model that Twitter does.

With the IPO market dried up, acquisition was the fastest (and only) way to liquidity. FriendFeed was partially self-funded, but even so, I’m sure the team and its venture backers, were glad to realize some cash and trade up to Facebook options.

Given FriendFeed’s short run, I wonder if this is a new model for the Valley, almost like a self-funded incubation lab in the open. Take an idea, form an awesome team and build something really cool, no business model required. Once you prove the idea and/or the team, sell yourself to another company as a lab.

Facebook obviously wins too. They get a crazy-good team to use on whatever project they like. Search seems to be a good place to start, since FriendFeed has really good search and Facebook doesn’t.  Facebook wants to be the interwebs, so naturally, they need good search.

Real-time, social search is a threat to Google’s dominance. FriendFeed built great, real-time features; there were so fast, that they had to add a pause button to allow people to keep up with the incoming stories. Adding the social layer of Facebook friends to the relevancy can only help the results you get.

I also see the FriendFeed helping to clean up the mess that Facebook has become. Have you looked at their privacy options lately? There are entire “guides” dedicated to help you set your privacy options. This isn’t good, so expect the UI chops of FriendFeed to translate into easier UI on Facebook.

I see Google as another winner here because they are being pushed to innovate and have apparently been noodling on ways to tweak search already. Enter Caffeine, which is already being tested. Google will move to protect its turf, which means better search for all of us.

Users of FriendFeed are definitely having a bad week. I doubt that many of them will move back to Facebook for lifestreaming, but wait a bit and someone will undoubtedly produce a clone project, like when Sandy was shuttered.

API developers are probably not happy either. Several desktop apps have been built around FriendFeed’s API, and they’ll need to have an exit strategy. This is also a warning for companies who have built around the public APIs of services like Twitter, FriendFeed and Flickr. Somehow I doubt that Facebook has plans to support the FriendFeed API ecosystem.

Let’s include Twitter here too. Facebook failed to acquire them late last year and went off on their own, beefing up their sharing features. The FriendFeed team has ties to Twitter and was one of the few companies to get access to the Twitter firehose API. This experience will help Facebook as they tweak their APIs and sharing.

There was talk of Twitter indexing all the shortened links that filter through their service, which would bolster their search, but for now, Twitter’s search isn’t terribly useful beyond trending. Frankly, Google could use Twitter’s API to apply the social context of following/followers to the tweets it already indexes and create a relevancy boost to its results without paying a dime to Twitter.

Twitter insists it wants to remain independent, but without a revenue stream and under the increasing infrastructure demands of its success, I wonder how long before they reconsider. It can’t be fun to watch your competition arm itself to make you irrelevant.

Overall, this acquisition isn’t that big a deal. It’s being amplified by the intertubes echochamber, and I find it hard to believe that the average Facebook user feels any different now vs. last week.

Give it a few months though and the impact will start to trickle into Facebook. Maybe by then the early adopters will have a new darling.

Find the comments and share your thoughts on this acquisition.



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