LinkedIn (LNKD) Acquired Pulse: Competition With Facebook (FB) And Google (GOOG) Intensifies !!

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The future of social networking sites is definitely going to be a massive marketing potential. Marketing in the new era, whether B2B or B2C, is about knowing the customers and engaging them. On the other hand, B2B marketing has made LinkedIn its prime focus in marketing compared to Facebook and Twitter says a study. It’s worth noting that 83% of social B2B marketers used LinkedIn last year to share content with other professionals.

LinkedIn (LNKD), the biggest online professional-networking service recently acquired 3-year-old newsreading app Pulse. LinkedIn confirmed the deal is valued at approximately $90 million, 90% in the form of company stock and 10% in cash.

This acquisition is definitely designed to turn the site from a resume depository to a full-fledged content site. The company is trying to push itself from the intense competition by adding new products and services to its professional networking space.

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Pulse was started in 2010 as a class project at Stanford to create the best-possible mobile news reader. At that time no one would actually have guessed that this side project will emerge as a major app/service, used by some 30 million users all around the world – either on iOS or on Android and network of more than 750 publishers.

LinkedIn_acquisition_Pulse

This figures will definitely help LinkedIn become the primary platform for distributing and consuming business-related content, Deep Nishar, LinkedIn’s SVP of products and user experience say. The application competes with Flipboard Inc., a news-reading service for tablets and smartphones.

He also praised Pulse founders Ankit Gupta and Akshay Kothari and giving some insight on LinkedIn’s plans for the mobile news aggregator.

“We believe LinkedIn can be the definitive professional publishing platform – where all professionals come to consume content and where publishers come to share their content. Millions of professionals are already starting their day on LinkedIn to glean the professional insights and knowledge they need to make them great at their jobs. We believe we can help all professionals make smarter and more informed business decisions leveraging all the great business knowledge flowing through LinkedIn in the form of news, Influencer posts, industry updates, discussions, comments and more.”

Why LinkedIn Chose Pulse?

Pulse is one among the number of news-recommendation applications that applies its algorithms and other filters to suggest content to users — a group that includes Zite (which was acquired by CNN in 2011) as well as News360, Flipboard and Prismatic.

Pulse was one of the first to make a big splash, in part because Apple founder Steve Jobs mentioned it on stage during the launch of the original iPad, and also because the New York Times accused the company of copyright infringement for aggregating its content.

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Since its launch, Pulse has grown to the point where it has about 30 million users, but it’s still seen as a runner-up to Flipboard in the news-recommendation souk, so an acquisition worth $90-million range would likely make sense for the company.

At last, when Facebook can leverage on its “Like” feature and introduce Graph search to which is proficiently used by recruiters to find candidates, why shouldn’t LinkedIn?? And of course, LinkedIn knows not only who you are but also knows where you’ve worked and who you’re connected with and what content you usually consume and what you’re consuming right now; they have a perfect pattern of how to engage with you.

So the beauty of the LinkedIn-Pulse gets really interesting in collecting information on what a LinkedIn user clicks on, which enriches the data that the site manages about each user. Beyond the resume and contacts, data on what news stories we care most about provides a constantly-updating stream of data that can be used by LinkedIn and also tracks content shared by a user’s business-related graph from LinkedIn, and then grows into a larger service incorporated into the site itself. And data from such a service would likely also be very interesting. Additionally, this move could definitely increase LinkedIn’s ad revenue.

Moreover, competition is also intensifying, with companies such as Facebook (FB), Google (GOOG) and Twitter. Similar to LinkedIn’s business model, these companies have started offering services that can provide to the professional world. Apart from hiring, the services include buying, selling and sales leads.

LinkedIn takes the acquisition for its growth strategy seriously, which is very evident from its past acquisition of SlideShare for $119 million in cash and stock, in May 2012.

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