Tynan on Technology (beta)

Breaking News: Google Buys Facebook

$25 billion deal combines two Web powerhouses

by Dan Tynan

In a move that stunned Silicon Valley watchers, Google announced it is purchasing popular social network Facebook in a cash and stock deal valued at $25 billion.

Google CEO Eric Schmidt and Facebook’s Mark Zuckerberg held a hastily arranged press conference where they outlined the key elements of the agreement.

Technically, Zuckerberg explained, Google is purchasing 98.4 percent of Facebook, leaving Microsoft with 1.6 percent ownership.

“We feel this accurately reflects Microsoft’s market share in the Web 2.0 economy,” he says.

Schmidt noted the many synergies between Google and Facebook that lead to the deal.

“With the acquisition of Facebook, users will be able to take advantage of OpenSocial applications across all the major social networks on the planet,” he said. “We’ll be able to incorporate Facebook apps directly into Android, our new mobile operating system. And, frankly, we were losing too many of our top people to Facebook. So now they’re all back where they belong. Forever.”

Schmidt added that if the employees chose move to another company, Google would buy that one too. And the one after that, and so on.

Zuckerberg would be put in charge of the new GoogleFace operation, sharing an office with Chad Hurley and Steve Chen on Google’s satellite campus in Gilroy. The deal will need to be approved by the Department of Justice and the Federal Trade Commission, but both CEOs expressed confidence the merger will move forward.

At the conference Schmidt added that Google is taking this occasion to adopt a new corporate mantra. “‘Don’t be evil’ has been a fine guide for a young, growing company.” he said. “Now that Google has reached a certain level of maturity, it’s time to move onto something less limiting. Thus today we are proud to introduce our new motto: ‘Google: Just because we can.’”