September 25, 2007 | Tuesday
Microsoft to buy 5% Facebook stake?
By Jackie Danicki - Blogger in News |Search Engines |Google |Yahoo |Microsoft
Hot on the heels of news that Facebook is now beating MySpace in the traffic game come reports that Microsoft is in talks to acquire a 5% stake in today’s most buzzworthy social networking site.
There have recently been proclamations from various industry commentators (some of whom are even working with Microsoft on other projects) that Microsoft should buy Facebook outright if they really want to compete with Google and MySpace. Whether or not Bill Gates’ pockets are deep enough is another matter.
What’s very interesting about this is that, not so long ago, many of those same industry commentators were ridiculing Facebook founder Mark Zuckerberg, 23, as a lunatic for not snapping up a Yahoo acquisition offer which valued his business at around the $1 billion mark. The Wall Street Journal report claims that Microsoft is talking about an investment which would value Facebook at more than $10 billion. Microsoft already has all of Facebook’s advertising business, so execs have more than a passing familiarity with the company. Om Malik remarks:
If the Z-meister takes the cash, then in a sense he is getting a put option from Microsoft, which prevents Facebook from embracing anyone else. Like Google (GOOG). It also ensures that Microsoft’s advertising business doesn’t go elsewhere…ever!
...Of course, when you have little a monetization issue, like Facebook has (and refuses to talk about), it is time to get OPM: other people’s money!
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