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Instagram boss under fire as $525 million Twitter offer revealed

BusinessNews
by Monira Matin
, 17 Dec 2012News
Instagram boss under fire as $525 million Twitter offer revealed

Recent reports indicate that microblogging giant Twitter offered Instagram CEO Kevin Systrom a $525 million deal (£324m) for his company in March, just weeks before a $1 billion (£616 million) deal with Facebook was agreed for the firm and its popular photo-sharing app.

According to the New York Times, Twitter executives gave Systrom a formal proposal which he verbally accepted, but then later backed out of. He eventually went on to accept Facebook's notoriously lucrative offer, though it was later revealed that the deal's final valuation amounted to just $715 million (£441 million).

Of course, a big business reining on a previous verbal commitment when confronted by a more profitable offer is hardly news in itself. But the revelations surrounding the Twitter/Instagram negotiations contradicts Systrom's claims, made to California state regulators under oath, that his company did not receive any "formal offers or term sheets" from potential buyers prior to its engagement with, and eventual marriage to, Facebook.

Tensions are currently running high between the social media rivals. Instagram recently disabled Twitter card support, with the result that Instagram photos displayed incorrectly on the microblogging service. Twitter, in turn, has released its own photo filtering feature as part of its mobile applications, in an effort to lure consumers away from the Facebook stable.

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