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Listed Techs Microsoft buys into $US15B Facebook
Listed Techs Microsoft buys into $US15B Facebook | Microsoft buys into $US15B Facebook |
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| by Stephen Withers | |
| Thursday, 25 October 2007 | |
      
Along with the equity investment, Microsoft will become the exclusive advertising platform for Facebook. This extends an existing arrangement that was restricted to standard banner advertising in the US. International traffic is increasingly important to Facebook: 59 percent of users are outside the US. "Making this investment and expanding this partnership will position Microsoft and Facebook to better take advantage of advertising opportunities around the world, and is a great win for not only for our two companies, but also our collective users and advertisers," said Kevin Johnson, president of Microsoft's platforms and services division. "The opportunity to further collaborate as advertising partners is a big reason we have decided to take an equity stake, and is a strong statement of our confidence in the long-term economics of this partnership," he added. Owen Van Natta, vice president of operations and chief revenue officer at Facebook, said "We think this expanded relationship will allow Facebook to continue to innovate and grow as a technology leader and major player in social computing, as well as bring relevant advertising to the more than 49 million active users of Facebook." Previous reports from Silicon Valley (eg Mercury News ) suggested Microsoft could value Facebook at as much as $US10 billion, a number dwarfed by the final agreement. Google was also reported to be interested in acquiring or at least taking a stake in Facebook. Around 18 months ago, BusinessWeek reported that Facebook owners rejected a $US750 million offer from an unidentified source, holding out for $US2 billion. With the benefit of hindsight, that $US2 billion now looks like a bargain price. |
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