Technology Slice Blog

Livingsocial Google Groupon Rival - If you haven’t heard, Google is very, very close to acquiring Groupon for a price in the $5.3 billion to $6 billion range. The press has been quick to speculate what the acquisition will mean for Google, but has said little about what it would mean for Groupon (besides the cash it would put in its founders’ wallets), nor the implications for Groupon’s number-two competitor, LivingSocial. First, the benefits. According to sources familiar with their respective marketing budgets, Groupon and LivingSocial each spend more than $1 million per month on advertising through Google alone — a huge share of their overall advertising spend. If Google acquires Groupon, the latter will have search inventory set aside for it in the same way YouTube does, effectively cutting a substantial share of Groupon’s advertising costs and, in theory, making it a more profitable business by lowering its operating costs. Groupon will also likely have more prominent placement...