Why Twitter May Be Allowing Vine to Continue Growing After All

When Twitter (TWTR)  announced late last month that it would shut down Vine in the coming months, the Internet immediately began grieving the demise of its favorite 6-second video sharing service via the hashtag #RIPVine.

But the platform may still see the light of day as Twitter is fielding offers for Vine, TechCrunch reported on Monday.

Twitter is said to have narrowed the pool of bidders from ten to five, with Japanese messaging and gaming company Line Corporation  (LN) , which recently went public in the U.S., rumored to be an interested buyer.

In October, Line released its own video sharing app, Line Moments, that allows users to record, edit and share 10-second clips. Line did not immediately respond to requests for comment for this story. 

Twitter's move to sell Vine makes more sense than just outright ending its operations, said Circle Squared Alternative Investment president Jeff Sica. The social media site has the chance to allow Vine to continue by selling it to another company with the manpower and capital to help it grow, Sica added.

A buyer may choose to keep Vine integrated into Twitter, treating it not as a direct revenue source, but as a way to advertise and generate revenue for other entities, Sica said. 

Sica likens the situation to Disney (DIS)  buying Twitter and using the site to direct viewers to content produced by its cable networks, such as ESPN.

Twitter's reported decision to try to sell Vine may have also been an attempt to "save face" with investors by reassuring them that Twitter management is making "smart decisions," Sica said. 

When Twitter launched Vine in January 2013, it could have established it as a leading video sharing service before Facebook's (FB) Instagram and Snapchat were created, but instead, it missed out.

"If they were smart they would have figured out a way to monetize it," Sica noted, adding that it became evident that Twitter had "no real plan" to grow revenue from the service.

Instagram's 15-second video feature, launched in June 2013, served as a serious blow to Vine because of the platform's significant user base, the New York Times reports. 

The move to get rid of Vine is also likely a part of Twitter's ongoing cost-cutting initiatives. Last month, the San Francisco-based company announced it would be cutting 9% of its workforce alongside a broad restructuring effort. 

However, Twitter might not see much of a windfall from selling Vine, as TechCrunch noted that some of the offers are for less than $10 million. Vine has been said to cost Twitter about $10 million monthly for infrastructure and employees. 

"Any anemic offer they get isn't going to make much of a difference," Sica said.

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