Google To Buy Groupon? Some Positives and Negatives [Rumor]

Filed as News on November 19, 2010 5:58 pm

Groupon - Google Acquisition Rumors

Every now and then a possible buyout of a big company is rumored to be underway at the offices of Google, a few months back it was a $2.5 billion buyout attempt of Twitter and today it’s the world’s largest social coupon sharing website Groupon.

According to Kara Swisher at AllThings Google is willing to pay above the $2 billion to $3 billion offered to the company by Yahoo. At this time the two company’s are not disclosing any details about the deal or for that matter if a deal is even in the works.

The move would be a big win for Google who could claim yet another dominance in local search, currently their services already allow mobile and other users to search for local businesses and other locations based on their location. The move would also give a big boost to the company’s Google Places interface by providing a comprehensive local deals system to uses on Google Places. Google could of course then make money from the Groupon system itself and through their ads based platform, allowing for extra revenue to be created for the newly purchased company.

With Google attempting to build out their Google Me social networking system, the Groupon acquisition could also provide a nice integration into their social networking attempt, which in turn could bring with it a loyal customer base that already spends nearly $50 million per month with the social coupon site. Groupon customers provide each other with a valuable social networking service, so why not bring them together to help form your new social community?

One pressing issue is whether or not Google could continue Groupon’s growth in the commerce sector, Google has failed in almost every major attempt they’ve personally made to sell directly (remember the Nexus One or the less direct Froogle?). If the acquisition includes a talent buy, Google would then need to work closely with their own employees and their newly minted Groupon employees to build a system that works for both Google and Groupon demographics, so immediate results probably wouldn’t be noticed.

One thing is for certain, Google better act quickly, some industry analysts believe eBay and Amazon could both jump into the acquisition game for Groupon and both would make excellent choices with their ability to build out merchant services, while providing very large consumer friendly user bases for the system. Heck, eBay already has strategic partnerships in place with Groupon and they understand the discount market better than any other online merchant.

Who do you think would make the best choice for a Groupon buyout?

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