Oct 24, 2007 at 5:07pm ET by Greg Sterling
The conference call is going on now. Here’s what the press release says:
Facebook and Microsoft Corp. today announced that Microsoft will take a $240 million equity stake in Facebookâs next round of financing at a $15 billion valuation, and the companies will expand their existing advertising partnership. Under the expanded strategic alliance, Microsoft will be the exclusive third-party advertising platform partner for Facebook, and will begin to sell advertising for Facebook internationally in addition to the United States.
The rumor had been that Microsoft would give Facebook the valuation it wanted to keep the relationship out of the hands of Google. “This deal marks an enormous advertising syndication win for Microsoft,” said Kevin Johnson, president of the Platforms & Services Division at Microsoft.
On the conference call Johnson justified the valuation and the investment, saying that Facebook “has the ability to get to 200 to 300 million users.” Johnson also suggested there was more to the deal than the public announcement indicated.
Facebook’s Owen Van Natta declined to mention whether there were any other investors in the round. He also said that the Microsoft investment wouldn’t affect the Facebook platform and third-party developers. Van Natta suggested in response to a question that the partnership may include paid search, but he declined to confirm that. For now it appears to be about display ads and “ad types that are unique to the social experience,” explained Johnson.
In response to questions about monetization, Johnson declined to offer specifics: “We continue to see improvement in the monetization of the Facebook ad inventory,” he said. Van Natta said that the Microsoft money would be used to grow and improve the infrastructure as well as for hiring, which he said would continue to ramp up next year.
While it’s not a certainty, this makes an eventual Microsoft acquisition much more of a possibility.
Share, Bookmark & Discuss This Article
More:
Keep Updated: News Via Email | News Via RSS Feed | News Via Twitter
See more stories like this in the Members Library! Check out the Microsoft: Business Issues, Microsoft: Partnerships sections of the Members Library where this story is filed. Members also get access to exclusive video content, a members-only weekly & monthly newsletter, plus more. Check out all the benefits!
TOP STORIES
SEARCH NEWS BRIEFS
FEATURES & ANALYSIS
RECENT COMMENTS
Stay on top of all the search news with our daily summary, the SearchCap newsletter. View a sample ›
Search Engine Land produces SMX, the Search Marketing Expo conference series. SMX events deliver the most comprehensive educational and networking experiences - whether you're just starting in search marketing or you're a seasoned expert.
SMX Web Site » | SMX Difference » | SMX News »
Join us at an upcoming SMX event:
Learn more about search marketing with our free online webcasts and webinars from our sister site, Search Marketing Now. Upcoming online events include:
Featured sites from our Blogroll
Become a premium member today and receive: