Instagram Deal: Facebook's New Friend Is Worth More Than The New York Times (PHOTOS)

Facebook could have bought The New York Times for less.

That's right, the $1 billion in cash and stock that Facebook paid for Instagram Monday values the two-year old mobile photo-sharing app more than The New York Times.

Instagram, a social network built around cellphone photos that has yet to make any money and has employed fewer than seven people for much of its existence, is now worth more in the eyes of its acquirer than a host of other name-brand public companies, including a major office supplies retailer with more than 1,100 stores, an 80-year old cosmetics company and the third-largest pizza chain in the United States.

Here's a list of companies now worth less, according to YChart's market cap rankings, than Instagram:

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• The New York Times ($970.22 million)

• Open Table ($963.30 million)

• Peet's Coffee & Tea ($957.73 million)

• Papa Johns ($914.49 million)

• Office Depot ($911.53 million)

• Revlon ($900.10 million)

• Dole Food Company ($865.85 million)

• Pep Boys ($787.56 million)

• La-Z-Boy Furniture ($786.20 million)

• Barnes & Noble ($745.51 million)

Drew Guarini contributed to this report.

Comments

[BigDaddyWow]

12:44 AM on 04/11/2012

There is a lot more here behind the scenes because at face value this was the stupidest business move in history. First, you are talking about an app. A cool app but an app none-the-less. This is a company of 13 20-somethings and they have NO BUSINESS PLAN. Facebook bought them to get a cool app and access to 12M subs - that are all Facebook users anyway. For about 200k you could replicate this system.

This is some kind of VC->Facebook->IPO deal but I am not sure what it really means.

[Jonny Craft]

10:50 PM on 04/10/2012

I would still invest in any of the examples above over Instagram. Instagram is a drawn out fad, it will be gone by next year, the businesses it values above will still be here! People need to stop valuing businesses/fads on the current market and look at long term valuing instead!

[MB1East]

09:57 PM on 04/10/2012

I worked for a "brick and mortar" retail company back during the last dot com bubble. They were so threatened by an online only competitor that they paid an obscene amount of money to get it. In the end, many of these online companies went belly up. It was determined that we wasted a fortune buying them out. Facebook is simply paying a ton - because it can - to own a competitor. Just to protect itself.

[lawa]

08:30 PM on 04/10/2012

if it doesnt work out its a 1Bn deduction

[MyResponsibility]

07:07 PM on 04/10/2012

It is worth whatever one wishes to pay for it, and the other is willing to sell it.

[Larz99]

03:37 PM on 04/10/2012

Not a chance it's worth more. It only has 12 employees, for pete's sake!

It's the start of Tech boom 2.0, I guess we they didn't screw us out of enough money the first time around...

[MyResponsibility]

07:08 PM on 04/10/2012

How did this sale deprive you of anything?

[Larz99]

08:03 PM on 04/10/2012

I didn't say it deprived me of anything. I was only pointing out that this is a sure sign that the new tech boom has started and we all know how well that went last time...unless of course you are a bank.

[Circadian Group-Inc]

03:07 PM on 04/10/2012

up and coming Fitness-Focused Mobile/ Social Applications Company InterAmerican Gaming (stock symbol: IAGM) could be a similar type of investment as Instagram-- only this time regular investors can participate in this Social Applications company-- instead of only the ultra-wealthy!

Imagine every marathon allowing remote participants to contribute to the charity because they're linked up to the marathon through IAGM's revolutionary App called SoFit Mobile!

Company DD Portal: www.Circadian-Group.com/iagm.html

[Phil Simon]

11:31 AM on 04/10/2012

Wow. The Office Depot number really surprised me.

Phil Simon

[coreylove]

08:46 AM on 04/10/2012

More ammunition for that adage "age is just a number". This is also one of those pinch-awake-from-a-dream moments where we're reminded that how people share and acquire info is rapidly changing.

Here's how I envision the Instagram team celebrating the acquistion: http://youtu.be/Nw1HXvjIHgI

[jrfields321]

12:40 AM on 04/10/2012

Guess this means that the new saying goes "a picture is worth a 1b dollars". So much for a 1k words!

[MyDriveIsGreen]

12:24 AM on 04/10/2012

The real issues here are not one of 'implied value' since there is ZERO reference to the balance of cash and stock(shame on you). If this is a pure stock deal, using the 'implied value' of FB stock as a form of payment, then I have property on Atlantic avenue that is available(but don't take FB stock as a form of payment).

Worrisome note here...what does 30 million Instagram clients need to know about the potential overlap of Facebook face recognition technology, and the self posted photos that they cherish.

I smell a nice fat class action lawsuit for misappropriation of use of a person's image for commercial gain here.

[MyDriveIsGreen]

12:21 AM on 04/10/2012

I find that this sort of 'thinly' investigated spoof reporting is unworthy of HP's usual good standards for editorial substance. Sad to see really.

[Bruce Pfeiffer]

11:47 PM on 04/09/2012

Expanding to Android was a big move. Now Facebook "pics" it up..
It is worth that much because of its originality and user potential.. It's definitely an entertaining service.

[Larz99]

03:38 PM on 04/10/2012

Yeah, but a billion dollars!

[BigDaddyWow]

12:47 AM on 04/11/2012

Uh, no. It's not worth $1billion. It's worth $50 million tops.

[Vic22]

11:18 PM on 04/09/2012

Yep, theres something definitely wrong here. A company with no revenue, that makes nothing, and provides and extremely repeatable service is worth more than those companies? Irrational Exuberance

[Laurie Head Atkinson]

11:04 PM on 04/09/2012

I was shocked to learn that Instagram was worth more than our 19-year-old company, AIS Network. After reading that it's also worth more than the New York Times, Revlon and Open Table, I feel much better. Thanks, Nate! ; ) - Laurie Head, VP, AIS Network Cloud Hosting, http://www.aisn.net

[MyDriveIsGreen]

12:20 AM on 04/10/2012

Laurie,

Don't be concerned. The New net model is to over inflate anything that looks promising. For instance, try to find anywhere that a 3rd party has audited the 'claimed' 800 million active log ins at FB. These include, of course, anyone that signs in to a 3rd party site with FB. Beware the tidings of the elite of San Jose, for the mighty will fall when a microscope is applied to the self perpetuated myths.

[EverMind83]

11:44 AM on 04/10/2012

uuummm... Nice free plug for your company