According to Kara Swisher, Yahoo, not Google, is looking into a possible investment in Facebook. This would look pretty bad for Yahoo, who tried to previously acquire Facebook for over $1 billion. While this is most likely a continuation of the rumors swirling around the valley about Microsoft’s investment at a $15 billion valuation for Facebook, it would make sense.
Google would be the best suitor for Facebook given that they want to index all of the data on the web and Facebook has a significant piece of inaccessible information. This position helps Facebook to support their astronomical valuation but once Google completely opens up, Facebook is going to be forced to do the same or experience a decrease in valuation. The real asset in the virtual economy is data and the more open you are, the more data you can track.
Google, Microsoft, Yahoo and AOL are currently the dominant players when it comes to tracking data but Facebook could soon join this elite crowd. As such, each one of the top four are trying to figure out a way to compete or invest. It sounds like Google is choosing to compete, Yahoo and Microsoft are vying for a piece of Facebook and AOL is an unknown. One thing is for sure though: Facebook was the catalyst for a new race to track and map all communication on the web. The race had already started before but Facebook has forced the rest to speed things up. It will be interesting to watch this all play out over the next couple of years.