Correction, 5/15, 6:15 p.m.: The purchase price for Plaxo was previously misstated. The price is thought to fall in the $150 million to $170 million range.
Comcast is adding a social dimension to its services through the acquisition of Plaxo, a deal the two companies announced Wednesday afternoon.
Terms of the deal were not disclosed, but thepurchase price is thought to be in the $150 million to $170 million range.
The acquisition is a big win for Plaxo, whose Pulse social network service, with 1.5 million active monthly users, has been overshadowed by the likes of Facebook and MySpace. It's a smart move by Comcast, which can enhance the user experience across its 14 million high-speed Internet subscribers, 3 million voice customers, and 24.2 million cable subscribers.
The acquisition is built on a preexisting relationship. In May 2007, Comcast partnered with Plaxo to offer a networked address book to subscribers of its various services. Comcast is Plaxo's largest customer and partner, with Plaxo hosting all Comcast subscriber e-mail address book accounts.
"The address book and Pulse combined will change the way people navigate through thousands of choices of content," said Sam Schwartz, executive vice president of Comcast Interactive Media. "You could know what shows your friends are watching, what they are downloading or what they are recording on DVR. Plaxo can help us build that vision. It's less about the Comcast.net portal and more about bringing the social aspects to all media consumption."
Plaxo's software could also be applied to Comcast's tru2Wayproject, which will allow developers to create applications that run on any set-top boxes.
"Many users on Pulse share Flickr photos with their friends and family. We want to extend that sharing whether they are in front of the TV, on the phone or at the computer," said Ben Golub, CEO of Plaxo. "Whether you are on Fandango (Comcast's movie ticket service) or on demand TV, it gets that much better with social graph layered on top."
Acquiring Plaxo will help Comcast socialize its cable, voice, and Internet services, including FanCast. "FanCast is major initiative in last couple years," Schwartz said. However, creating a user interface that can make sense out of all the content choices and devices will be even more difficult than creating a universal remote that a mere mortal could program and use.
"We understand that consumers are looking in lots of places for content, and it should be tied into one easy-to-use interface. You can ask it where to get content and it will tell you if it's on TV, in a theater, on demand, or on FanCast," Schwartz added. "We are very much innovating in terms of how consumers manage content. With the choices becoming almost infinite, you need better ways to navigate. The key is making it simple for the user. Right now we are in period of time where users could be confused--did they order it on Netflix, did they buy it on iTunes, did a friend buy it, is it loaded on a DVR. We can help create the best possible environment for the consumer."
Plaxo will fall under Comcast Interactive Media, which is tasked with growing Comcast's Internet business. "Pulse features will be turned on in some Comcast properties starting this year, but it is a multi-year strategy as we give the social media experience to all platforms we are on," Schwartz said.
Comcast could have chosen other routes to gain a social dimension, such as Google's nascent Friend Connect. "Friend Connect is complementary to Plaxo Pulse. It's trying to light up the long tail of the Web site. This is about making social media a natural part of the (Comcast) experience," said John McCrea, vice president of marketing at Plaxo.