Yahoo, flush with cash from the sale of its stake in Alibaba and anxious to remake itself as a mobile-based business, may be in late-stage discussions to acquire Foursquare, according to TechCrunch -- which admits that even its own sources at Yahoo don't agree on whether a deal is actually in the works.
On Wednesday (April 15), TechCrunch reported that according to sources on both coasts -- Foursquare is based in New York, Yahoo in Silicon Valley -- a Yahoo/Foursquare deal is either being finalized or well underway. However, TechCrunch said other sources at Yahoo reported that they'd heard nothing about a deal. "Either this is elaborate, bicoastal speculation, or it is happening with only a select circle privy to what is going on," TechCrunch wrote.
Shortly after TechCrunch published its story, Re/code reported that "multiple people familiar with the companies" said there were no Yahoo/Foursquare talks, and CNBC reporter David Faber said that "people familiar with the situation indicate to me there is nothing going on here in terms of any acquisition by Yahoo of Foursquare, terming that a rumor that has no truth to it, for what it's worth at this point."
A Yahoo spokesperson declined to comment to TechCrunch, and so did Foursquare CEO Dennis Crowley. A Yahoo/Foursquare tie-up has been rumored repeatedly in the past, TechCrunch said, adding that the most recent rumor gives Foursquare a price tag of $900 million.
What all the sources agree on is that privately held Foursquare's value isn't in the check-in and recommendation businesses of its namesake app and the Swarm app that it separated out last year. Instead, it's in the location data that Foursquare has collected over the past six years from 55 million people doing 7 billion check-ins in more than 65 million places through its apps.
Foursquare licenses that data, which associates GPS coordinates with specific businesses, to Microsoft, Twitter and other mobile-related businesses. Daily Mail North America CEO Jon Steinberg estimated on CNBC that it brings Foursquare revenue of up to $100 million a year.
Foursquare is also hoping to use the data itself to generate more revenue. On Tuesday it launched Pinpoint, a location-based advertising network that it said will target users by device, location and other parameters, depending on advertisers' needs. Pinpoint is reportedly already being used by AT&T, Samsung, Land Rover, Olive Garden, Choice Hotels and FedEx Office/Kinko's stores.