Is this mad or is it plain wrong? Or is it just overcooked journalese. (In which case, who are we to tut tut?)
The New York Post reported on Wednesday that Google is threatening once again to beat rival Microsoft to the deal punch, “this time in the white-hot Facebook investment sweepstakes.” A holding of five to ten per cent is up for grabs and we already know that Facebook founder, Mark Zuckerberg, and seed investors Accel and Greylock, are looking for a valuation north of $10bn for the social networking site.
But The Post adds:
Google, in keeping with its past modus operandi, has been trying to drive the price up to a point that would scare away Microsoft. Running point for the Internet giant in its talks with Facebook is Tim Armstrong, the same executive who helped Google elbow Microsoft out of a deal with AOL similar to the one being talked about with Facebook.
This time around, however, Microsoft is hanging tough, despite recent comments by CEO Steve Ballmer that social-networking sites were “a bit faddish.” One source said the Redmond, Wash.-based company is “willing to give any valuation possible” to keep Facebook away from Google.
So let’s get that straight. Both Microsoft and Google will pay any price to win, says The Post, and we should take that statement seriously because the newspaper cites “three sources familiar with the situation.”
Here on FT Alphaville we have to confess to being unfamiliar with such auction tactics. We thought that when there is competition for an asset, the putative buyers tend to set the maximum price they are willing to pay, which they then keep secret as they try to buy the asset for less.
Maybe it’s some psychological wheeze – let’s call it Puffing Yourself Up 2.0 – where if you say “I’ll pay anything cos I wannit!” maybe your opponent will believe you. And where better place to make such a brag than through the New York Post.
Or maybe it has something to do with what Portfolio’s Felix Salmon was going on about on Tuesday, discussing the apparent need for conflict in business journalism.
He cites the view of an alleged Portfolio colleague, Jack Flack, who believes that “business journalism sells best when it apes sports journalism, particularly in framing clear conflicts that elevate the mundane into something more compelling,” with Flack adding:
That’s particularly true of business television. CNBC struggled until Ailes focused it on the stock market, which effectively provided a scoreboard that sets the context for hundreds of little dramas each day. Squawk Box was supposedly modeled on ESPN’s Sports Center, and each day is neatly summarized by market “winners” and “losers.”
To which Salmon adds:
There are two consequences which follow from this fact — and it is a fact. The first is that important business stories fail to be written, every day, because there isn’t a nice obvious conflict to drive (readers to) the story. The second is that very unimportant stories, about the Dow going up or down a couple of hundred points in one day, take on a massively overblown importance, because they fit so well into the winners-and-losers paradigm.
As a result, a good test of any business story is to ask yourself whether there’s an obvious conflict driving it. If there is, then you might want to mentally downplay it. If there isn’t, then it might actually be very important.
Which leaves us impressed – and confused. So the battle between Google and Microsoft for a piece of Facebook isn’t really a story after all..?