The big story in the social media world is CNN’s rumored plans to purchase the news site Mashable for, get this–$200 million. Believe us, we’d be interested if our work gets noticed by such big names with big money—emphasis on interested. Although the headlines are suggesting that possibility, Pete Cashmore, the founder of Mashable, has denied such rumors. If the rumors are true, we hope that Cashmore should stick to his guns and keep Mashable in his domain and here are five reasons why:
Just because you tack a big name company like TimeWarner (owners of CNN) doesn’t necessarily spell future success. Take the saga of News Corp (owners of FOX) in its purchase of Myspace. The company’s 2005 $580 million purchase of a then-social media behemoth raised many eyebrows and they were riding into user success. What the corporate peeps didn’t know was that Facebook was lurking in the shadows, waiting for its moment to shine. Combine that with a much more complicated interface and the aggressiveness to monetize every user and it was a disaster for News Corp. Six years after its purchase, News Corp sold Myspace to a group of investors that included Justin Timberlake for a mere $35 million.
Although such a deal with CNN would rake in more monetary investment for Mashable, it would also mean the end of independence for the social media news site. With CNN as having the upper hand, it could mean that Mashable would have focus on content that may not pertain to its core audience—techies and social media mavens. That would not only hurt the brand, but also may turn off its loyal readership. Listening to what the audience wants is a key to success and Mashable articles pertain to their tastes.
When people think Mashable, they think all Facebook, Twitter and YouTube news, all the time. That is their brand and focusing on that niche is what made them a success in that field and garnered the interest of many big names. With the possibility that CNN may purchase the site, people will be left to wonder whether Mashable will remain as is or will be folded into the CNN brand. Most likely, should Mashable become CNN’s asset, it would be integrated under their brand, leaving it without a distinct identity. Years of hard work and good content would likely disappear with the acquisition.
The problem with having a big company purchase your brand is that your plans for growth may not necessarily match what the corporate board wants. From its latest offerings, the social media news site has attempted to cover more business and entertainment news (not to mention a large bevy of infographics!) Mashable has the potential to branch beyond just social media news, but a possible CNN purchase would only pigeonhole the site as part of the news network.
CNN isn’t the only company that has sought to make Mashable a part of their own. AOL attempted to buy the blog in 2010 for an undisclosed sum, but instead decided on purchasing rival TechCrunch for $25 million. My guess is that Mashable’s value will only become stronger with CNN’s proposal and if Cashmore decided to spurn them, someone else will likely step in and offer a deal that’s reasonable for the company’s value.