Death to Trespassers
Return to The Treasure Under the Fortress
Earlier this week, News Corp. bought Photobucket and Flektor. While the acquisition of both companies makes sense in terms of better integrating tools widely used by the MySpace crowd (Photobucket provides an easy way for users to share videos and pictures, while Flektor makes tools for building slideshows and video mashups), the deal also sent a clear message to advertisers eager to tap into the social networking site: Pay up.
In April, Photobucket cried foul when MySpace pulled the plug on its unauthorized "Spider-Man 3" campaign. While Photobucket CEO Alex Welch quickly put out the fire by striking a deal with MySpace to restore the service, saying both companies were committed to best serving their users, a larger deal was likely in the works.
After a month of rumors, Photobucket confirmed that it had accepted an offer to join the Fox Interactive family.
"The acquisition of these two companies is a perfect strategic fit for us that reinforces FIM's leadership in user-generated content," Peter Levinsohn, president of Fox Interactive Media, said of the deal. "As a leading site for creative expression, Photobucket extends our reach among personal media sharing enthusiasts and the innovative new entrant Flektor brings highly-differentiated new tools to the table that will drive the next generation."
In addition to more than 40 million registered users, the Photobucket buy also gives Murdoch and crew greater assurance that it will be able to cash in on the next big widget campaign (or some as-yet-unnamed viral phenomenon) without having to battle another company and risk turning off users.