This news can be interpreted according to your affinity for Groupon. If you're skeptical, this is yet another strike against the model, the canary in the coal mine. If you're optimistic about Groupon, this is a win, a step toward answering the claim that there's no means for them to outcompete all of the clones.

It will be interesting to see if any more details come out, and if it's possible at all to establish which interpretation is closer to the truth.

Can I throw in "Clearly, Facebook is in the end-stages of negotiation to acquire Groupon!"? I mean, as long as we're all staring at tea leaves, let's have some fun.

Actually, a partnership with a current deals site I think would be a great idea. Facebook can bring in an audience for free but not have to worry about finding deals.

Can't imagine Facebook would partner with a site. They'd probably try to buy it and then intrgrate it as a feature in Facebook itself.

Stack Overflow?

http://facebook.stackoverflow.com

They partnered with those geolocation sites didn't they?

I look at it the other way round: either it's an indication Facebook believes that check-in deals will prove vastly more lucrative than what is essentially a digital equivalent of untargeted coupons you cut out of magazines, or a scathing indictment of Facebook's failure to generate non-trivial revenue from this type of promotion despite arguably the best platform in the world for running it.

Running a successful deals program in the current (competitive) market requires two things that it seems Facebook isn't much inclined to provide: (1) non-engineer staffing, to find and close deals with merchants and (2) customer service.

This coupled with the abandoning of Places makes me think Facebook is undergoing a serious narrowing of focus. While I'm clearly not a fan (as you can probably judge from my comments), I'd still like to see a company that gets lots of press do something innovative or, in absence of that, just new and different. The pessimist in me thinks it will be yet another web platform play.

They did not abandon Places... I'd even say they did the exact opposite: they integrated the feature into everything, so instead of just being able to say "I'm here now", you can now state that /anything/ occurred there (and at any time in the past, when relevant) by tagging things like status updates or pictures with Places. You can even get exactly the old behavior by making a post that includes only a ___location, and no status. I really have no clue how this crazy rumor started that they abandoned or discontinued Places :(.

It started beecause they are taking it out of the mobile App as far as I remember. If true I don't understand why they couldn't just add the features to the app instead of removing one of the most useful features of Facebook.

Very interesting. It's clear that Groupon is willing to dedicate a lot of pre-IPO capital to the project. Facebook probably figures that it's not worth giving up being profitable to do. At least not yet.

In many cases the second or third mover can still win. Think Yahoo and then Google in search. (Whatever did happen to Altavista?)

The area that Groupon really shines in, and that Google was trying to acquire, is the vast number of local salespeople on the ground. Customer service and interaction are not Facebook's strong points.

Local salespeople on the ground?

Doesn't Groupon just have one giant call center in Chicago?

They're not shutting down deals. They're shutting down the desktop version - the mobile deals product still lives.

I think this is a sign that people are more likely to use a deals product when it's relevant to their ___location and current activity.

Well, not even. Facebook Check-in deals launched in Australia, with KFC being a big partner. It was expected that the average store would see 150 people redeem the deal a week when in reality each store would be lucky to get 1 a day, most being from KFC staff.

I work with 2 of the media agencies who do these bookings, one of which handles KFC.

Results haven't been great but it's a fledgling product. There is a lot of consumer awareness to be done to get it going.

The brands are not about to stop, I believe they see it as an experiment that will hopefully pay off.

Is Groupon next?

It may be more lucrative to partner with deal sites and take a cut of revenue through ads and the like - without the expense. In some way, Facebook Deals is like Google getting into ecommerce - it's better just to be a middle man and sell ads.