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A few weeks ago, I met up with Mark Sigal, who is the CEO of vSocial. In fact, it was on that day that MySpace announced it was blocking Photobucket users from posting videos. Sigal actually thought this was a prelude to a buyout. "MySpace could be wielding some of its power to get a better valuation," he said to me.
Well, this week MySpace bought Photobucket. It's not clear what the price tag came to. Although, a story in Red Herring indicates that it could be as high as $300 million.
It's a smart deal for MySpace since online video has become a strategic asset. While Photobucket does not have a megabrand like YouTube, there are still 40 million unique users.
Besides, much of Photobucket's traffic came from MySpace (almost 60%). So, in terms of an M&A exit, there was really only MySpace as a suitor.
Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.
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