tag:,2008:/1/tag:72.47.210.69,2007://1.3127- 2008-05-09T18:09:43Z Comments for Microsoft Beats Google on Facebook Deal; Valuation $15 Billion Movable Type 4.1 tag:72.47.210.69,2007://1.3127 2007-10-24T20:35:16Z 2007-12-16T23:08:16Z Microsoft Beats Google on Facebook Deal; Valuation $15 Billion We wrote earlier this morning that Google and Microsoft were competing for a stake in Facebook, the super-hot social networking platform. Earlier, the NY Post was reporting that Google was the frontrunner. But a WSJ report has now confirmed that Microsoft won out: "Microsoft Corp. agreed to invest $240 million for a minority stake in... Richard MacManus http://www.readwriteweb.com We wrote earlier this morning that Google and Microsoft were competing for a stake in Facebook, the super-hot social networking platform. Earlier, the NY Post was reporting that Google was the frontrunner. But a WSJ report has now confirmed that Microsoft won out:

"Microsoft Corp. agreed to invest $240 million for a minority stake in Facebook Inc. that values the social-networking site at $15 billion. As part of the deal, the two companies expanded their advertising agreement."

The amount invested is lower than expectations, which were around $500M. Microsoft's new deal with Facebook is all about bolstering their existing advertising arrangement - Microsoft will now sell Facebook's international display ads, in addition to the banner ads it already sells on the US site. However this deal leaves room for Facebook to run its own advertising network, which we have been discussing on Read/WriteWeb. Facebook's ad system will likely use social profiling to target ads, given the wealth of such data that Facebook has.

]]> UPDATE: Hitwise just sent this data, which shows Facebook's growth in the US market over the past year:

  • Facebook.com was the ninth most visited website (as ranked by Hitwise) in the U.S. receiving .96% of all Internet visits for the week ending 10/20/07.
  • U.S. traffic to Facebook.com has increased 102% YOY comparing the week ending 10/20/07 versus 10/21/06.
  • Among a custom category of leading social networking websites, Facebook.com received 15% of U.S. visits for the week ending 10/20/07. That was second most among social networking websites behind MySpace.com, who received 76%. Windows Live Spaces received .40% for the same week.
  • Facebook.com received '9.90%' of its U.S. traffic from Search Engines for the week ending 10/20/2007. Of that traffic, MSN Search and Live Search combined for .46% to Facebook.com last week. Google sent 6.82% percent of U.S. traffic while Yahoo! Search send 1.34% of traffic for the week ending 10/20/07.
  • U.S visits for Facebook.com among users ages 35 and over have increased 19% comparing the week ending 10/20/07 versus 10/21/06.
]]> tag:72.47.210.69,2007://1.3127-comment:25342 Comment from Justin Kistner on 2007-10-24 Justin Kistner http://www.metafluence.com/ Wow, what an incredible act of desperation on Microsoft's part. Facebook is not worth that much money and it feels like more of a play not to be the exec that got fired for letting Google snag the deal.

]]> 2007-10-24T22:25:15Z tag:72.47.210.69,2007://1.3127-comment:25343 Comment from Dan Ackerman Greenberg on 2007-10-24 Dan Ackerman Greenberg http://www.ackermangreenberg.com Microsoft is going to f*cking ruin Facebook.


Dan

]]> 2007-10-24T23:02:19Z tag:72.47.210.69,2007://1.3127-comment:25344 Comment from Pete on 2007-10-24 Pete Sorry, but I think this was a brilliant and gutsy move on the part of Microsoft's Directors http://www.newsvisual.com/newsvisual/2007/10/microsoft-diver.html . The potential online ad revenue is worth more than the measly sum Microsoft just paid out. Plus, if things pan out Microsoft might just gain ground on Google, their ultimate mission. This move actually is pretty aggressive for Microsoft and probably caught Google off-guard a bit and put them on the offensive.

]]> 2007-10-24T23:42:01Z tag:72.47.210.69,2007://1.3127-comment:25345 Comment from RS on 2007-10-25 RS Microsoft's had a nice long peek under Facebook's skirt for awhile now. I guess they must see some sort of potential. I wonder how much of it was simply trying to cut off Google though . . .

Somebody better figure out a way to monetize Facebook or we're all going to be laughing hysterically at the current valuation hype a few years from now.

From an advertiser's perspective, there's no current (or emerging) behavioral targeting ad technologies that I'm aware of to DRAMATICALLY ramp up their ad revenue in a way that will scale well beyond just simple user growth. Google's search-based advertising model scaled beautifully (and also performed exceedingly well) which is why their ad revenues are about 100x Facebook's and still growing strong. I just have a hard time seeing anything that's going to scale the same way for Facebook, especially if they continue to try to just play behind their own walls without branching out.

]]> 2007-10-25T14:42:36Z tag:72.47.210.69,2007://1.3127-comment:25346 Comment from Nico on 2007-10-25 Nico http://www.nicoamon.com Quite interesting situation here. I don't really thing that this move will get result in this 5 years. Lets see...

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