Google has held discussions about acquiring a video-sharing startup -- Firework -- that could help it counter increasing competition from TikTok, people familiar with the matter told Dow Jones.
Firework is a free smartphone app for users to share 30-second homemade videos with strangers. The company tries to surface viral, edited videos from unlikely sources, though Firework aims for an older audience than TikTok, which is popular among teenagers. TikTok's parent -- Beijing-based ByteDance -- is valued privately at $75 billion.Redwood City, Calif.-based Firework, meanwhile, was valued at more than $100 million in a fundraising round earlier this year, and any acquisition would likely include a premium.
Google and Firework haven't yet discussed prices, the sources said, and the discussions might not lead to a deal, but could spark conversations about other partnerships.
Firework was launched last year by former executives from Snap, LinkedIn and JPMorgan Chase. Earlier this year, the startup raised about $30 million from venture-capital firms including IDG Capital, GSR Venture and Lightspeed Venture Partners China.The Firework website boasts that millions of people have downloaded the app to share videos such as extreme mountain-biking and guitar-instruction tips. The popularity of such content is why more than one in seven people on earth have downloaded TikTok to their smartphones.
Firework’s edge is that it works closely with major phone manufacturers to develop features specifically for their hardware. For example, videos shot on Apple's iPhone can display footage shot from both the handset's front and rear-facing cameras at the same time.
Weibo, China's version of Twitter, has also expressed interest in Firework, but their discussions have not advanced as quickly as those with Google.
Google, an Alphabet unit, is scouting for the next big trend, just as it did when purchasing YouTube 13 years ago and developing it into the leading destination for online video.
YouTube has 2 billion monthly users, and 500 hours of new content is uploaded to the website every minute. The platform represents about 20 percent of Alphabet's annual advertising revenue, but the rise of competitors threatens some of that.
Google isn't alone in moving into the short-video space. TikTok's rapid growth in the U.S., particularly in the teen demographic, alarmed Facebook executives, who launched a similar app called Lasso in 2018. Snap Inc., one of the first strictly video-sharing apps, has rolled out new features to keep up with the competition.Part of Google’s motivation, people briefed on the plans say, is to stay ahead of the vanguard.CLICK HERE TO READ MORE ON FOX BUSINESS