Photo courtesy of elminium via Flickr.

A Guide To 2014’s Billion-Dollar Tech Acquisitions

Photo courtesy of elminium via Flickr.

Major tech companies are continuing their billion-dollar shopping spree. Learn how much they’re spending and why in our 2014 tech acquisition watch.

Tech companies have hundreds of billions of dollars in their vaults, and they’re using that to expand their product offerings. See what companies have bought in recent years here.

Our 2014 tech acquisition watch will show the scale of these acquisitions, and show why they’re happening.

Since anything below $1 billion seems downright unfashionable these days, we’ll consider that our starting point:

Google buys Twitch
Sum: $1 billion
Date: 5/18/2014

What the buyer gets: a video game streaming website that has 45 million visitors monthly, each of whom spend an average of 106 minutes on the site. Oh, and it’s obviously also a direct competitor to YouTube.

$1 billion

Comparable to: The $1.1billion cost of the American sea-and-air campaign against Libya in 2011.

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Photo courtesy of the U.S. Navy via Flickr.

Facebook buys Oculus Rift
Sum: $2 billion
Date: 3/25/2014

What the buyer gets: a much-hyped piece of hardware that could finally make virtual reality gaming a thing. For Facebook, it represents “a new communication platform,” in the words of Mark Zuckerberg.

$2 billion

Comparable to: The $2.1 billion Great Green Wall, being built across Sahara to prevent desertification.

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Lenovo buys Motorola
Sum: $2.91 billion
Date: 1/29/2014

What the buyer gets: The smartphone division of Motorola, which will strengthen the Chinese companies smartphone offering, as well as expose them to markets in North and Latin America.

Google buys Nest
Sum: $3.2 billion
Date: 1/13/2014

What the buyer gets: A foothold in the Internet of Things with Nest’s product lines of smart connected home devices like thermostats and smoke alarms.

Apple buys Beats
Sum: $3.2 billion
Date: 5/8/2014

What the buyer gets: this one left a lot of analysts puzzled, considering Beats’ headphones and streaming services are not considered very strong products. However, by buying them out, Apple gains a new line of high-profit margin products and strengthens its balance sheet for shareholders.

$3 billion

Comparable to: The decade-long project to unlock the secrets of the human genome, which also cost $3 billion.

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Image courtesy of TEDed via Tumblr.

Facebook buys Whatsapp
Sum: $19 billion
Date: 2/19/2014

What the buyer gets: a rapidly growing mobile user base currently at 450 million, on a direct messaging service that can compete with Tencent’s WeChat and apps like Snapchat that are drawing in Facebook’s dwindling teenage users.

$19 billion

Comparable to (with change to spare): NASA’s complete budget for 2015, set to be $17.5 billion.

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Image courtesy of NASA. 

AT&T buys DirectTV
Sum: $48 billion
Date: 5/18/2014

What the buyer gets: an additional 20 million users around the country, and the leverage to demand lower costs from cable companies and content providers. It’s also a great bulwark against the yet-to-be-approved Time-Warner-Comcast merger.

$48 billion

Comparable to: The annual $44-billion military budget of Germany, the world’s 8th largest by expenditure.

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Photo courtesy of isafmedia via Flickr.

Scorecard:

Google
Spent: $4.2 billion
Acquired: A popular video gaming streaming site with 45 million users, and an Internet of Things product line.

Facebook
Spent: $21 billion
Acquired: A mobile user base of 450 million and a virtual reality headset

Apple
Spent: $3.2 billion
Acquired: A product line of high-profit-margin headsets

Ole Skaar