Rumors have been rampant this week about Apple (NSDQ: AAPL) using some its $29 billion war chest to buy Twitter for around $700 million. Plenty of bloggers are speculating about whether these rumors are true — we won’t waste your time with more of that. (And Twitter Founder Biz Stone said straight out on The View today that Twitter was not for sale). We’re more interested in the $700 million figure: Specifically, if Twitter were to be sold, is that the right price for it?
Internet companies with a lot of users but little-to-no revenue are often valued based on their number of visitors. Twitter reaches 18-19 million unique monthly visitors, according to comScore (NSDQ: SCOR). That $700 million price tag would then value the company at about $40 per visitor. How does that compare with the prices paid in some of the big social-media acquisitions of the last few years?