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8/23/2010
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Facebook Gobbles Hot Potato

Location-based service will cease operations as features are integrated with the social network.




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Days after launching Facebook Places, the social media site disclosed its acquisition of Hot Potato, a 20-month-old location-based social event service.

On Friday, Hot Potato told members it soon will wrap up operations.

"We will no longer be accepting new user registrations, and we will be offering existing users a way to download their information from the site," said a blog posting by the Hot Potato team. "In about a month, Hot Potato will close up shop and delete all user data. No user data or account information will be kept by Facebook. We will be sure to keep you posted on this process over the next few weeks."

Facebook is expected to integrate some Hot Potato features.

"Today, we're thrilled to announce that some of the features and thinking behind Hot Potato are going to be exposed to a much larger audience: We've been acquired by Facebook," the blog said.

With Hot Potato, users shared information about their activities or plans, whether it's watching a movie, attending an event, or listening to a lecture. Accountholders involved in similar actions are joined in a group, and then are able to trade images and ask each other questions about the live events they are sharing.

Terms of the deal were not disclosed. However, the acquisition was valued at between $10 million and $15 million, according to MediaMemo. When Hot Potato was founded in January 2009, the company raised about $1.4 million, said published reports at the time. It released its service and iPhone app in November of that year.

Even before the acquisition, Hot Potato accountholders could seek out other users among their Facebook friends, using their Facebook logins. Hot Potato users could link these profiles to their Twitter and Facebook accounts. When he founded the company, Justin Shaffer said he was not trying to compete with either Facebook or Twitter, preferring instead to "facilitate collective storytelling," he told the New York Times in late 2009.

On Aug. 18, Facebook debuted Facebook Places, a way users can share their location with other Facebook users and applications and locate their friends.

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