For the past few years Twitter has been on a downward spiral, struggling to create a unique niche in the social media industry while fighting a plateau of user growth and declining revenue. However, with what many are calling a “life jacket” deal, business journal Forbes has recently reported that Twitter is in talks with the Walt Disney Corporation to consider a bid to purchase the company. In the face of stagnant user growth and a failing business model, speculation is abound on a potential Twitter takeover for almost a year, but this is the first true evidence that Twitter officials are considering a buyout. Yet the question still remains: will Twitter take the deal?
Many investors think so (at least if a player like Disney is bringing an offer to the table). Our readers may recall one of our earlier blog posts on Twitter’s massive rebranding campaign to position itself as a live-streaming information hub, a field that interests Disney as a compliment to Hulu, the video-streaming company in which Disney is a large investor. Though the success of Twitter’s rebranding campaign remains to be seen, taking the company in a video-streaming direction means that the groundwork has already been laid for Disney to throw its clout and resources behind it and see results.
A potential Disney and Twitter partnership even more sense when one considers Disney’s affiliation with organized sports. Through its stake in ESPN, Disney holds a contract for television broadcasting rights for NFL games through 2022. Twitter, in its continuing quest for live-streaming content, has also acquired the rights to broadcast football games. The games have been successful so far, with the first broadcast reaching over three million viewers. Combining the cable TV platform with an online presence would give Disney a major advantage over its competitors when reaching football fans. Even though Twitter’s business is a risky purchase, its assets are not.
This remains up in the air, as Twitter is also entertaining potential bids from companies such as Salesforce and Google. One thing is clear, though: Twitter is fluttering.