Google Is Said to Have Held Acquisition Talks With Twitch

May 20, 2014 12:01 am ET

May 20 (Bloomberg) -- Google Inc. has held talks to purchase video service Twitch Interactive Inc. to boost its YouTube site, according to a person with knowledge of the matter.

With Twitch, Google would gain a platform that has more than 45 million active viewers a month. The San Francisco-based company acts as a social gathering place for video gamers, letting them discuss games or watch other players. Twitch is available on Sony Corp.’s PlayStation 4 and Microsoft Corp.’s Xbox One game consoles.

Variety reported earlier this week that the two companies are in talks on a transaction that could value Twitch at about $1 billion. Tim Drinan, a spokesman for Mountain View, California-based Google, declined to comment yesterday, as did Matthew DiPietro, vice president for marketing at Twitch.

Walt Disney Co.’s recent agreement to purchase Maker Studios for as much as $950 million has set off a scramble among well-capitalized companies to invest in or acquire online video companies that have a large viewer base. Google is stepping up efforts to bolster its video offerings as more users go online to find such content. YouTube was the No. 1 provider of video content in the U.S. during March, according to ComScore Inc.

Google has been on an acquisition tear as it looks to bolster services and attract more users. The Web-search company acquired digital-thermostat maker Nest Labs Inc. for $3.2 billion in February, and it has made several smaller deals in the past few weeks. Those include Stackdriver Inc., a startup that specializes in helping companies use online computing services, and Adometry Inc. to boost its Web measurement and analysis services.