Not Another Twitter-Google Buyout Rumor!

Yes, it's true; there's more buzz that Google will snatch up Twitter and add it to the monolith. The first rumors cropped up in late February, when Google set up a Twitter account and prompted speculation that the search engine was on the cusp of a deal. Now, TechCrunch reporter Michael Arrington claims that inside sources tell him Google and Twitter are in the late stages of talks about a buyout.

First, the price. Since Twitter was recently valued at $250 million, Google would have to slap down considerably more than that, in both cash and Google stock. Why would Google spend that kind of money? According to Arrington, it's all about search. As people post tweets about products they use in real time, the companies that make those products would love to collect such instant feedback, and they can use Twitter's search function to pull it out of the air. In addition, plenty of tweeters could use the search function to look for news as it breaks, spread by other tweeters. This means ads could be paired with the search function, and as Google knows all too well, that means money. "If this is accurate, it's a brilliant deal for Google -- the value of Twitter is only going to go up over time," Arrington concludes.

Not so fast, replies tech reporter Kara Swisher. She's talked to plenty of inside sources too, she writes, and they all deny that a deal is in the works. Yes, Google and Twitter reps have been talking, but only about Twitter's search capabilities; nothing like a sale was ever discussed. Swisher thinks Google should buy Twitter, and argues that it will if Microsoft comes sniffing around the company. But right now, she claims, the inevitable $1 billion price tag is a little too steep for Google, which has struggled to justify blowing such a wad on YouTube. And Twitter's founders are having too much fun playing with their new toy to just cash out right now. (Swisher adds a delightfully catty note at the end, pointing out that TechCrunch has a history of breathlessly pumping up Google buyout rumors such as Digg and Bebo, neither of which came to pass. "The third time, is no surprise, not a charm either," she writes.)

Finally, Swisher points out that Twitter co-founder Biz Stone went on The Colbert Report last night and insisted that Twitter fully intends to be a "strong, profitable, independent company." But she didn't mention Colbert's riposte: "You and Pets.com." Here's the Stone interview in full.