Tuesday, 25 September 2007

Microsoft Considering Facebook Stake

The Wall Street Journal said Microsoft, which is lagging behind Google in the online advertising market is looking at buying almost five per cent in one of the world’s top three social networking site...

Microsoft is looking at acquiring a stake in social networking site Facebook, according to media reports. The Wall Street Journal said Microsoft, which is lagging behind Google in the online advertising market is looking at buying almost five per cent in one of the world’s top three social networking site.

The investment may be between USD 300-500 million, giving Facebook an overall value of USD 10 billion, the newspaper reported on its Web site, citing unidentified people familiar with the matter. The talks are still preliminary and Google has also expressed interest, the newspaper said.

Google had acquired Orkut and Wall Street’s parent NewsCorp had bought MySpace. This left FaceBook as the last of the top three social networking sites to be acquired and now with Microsoft showing interest, it is an battle to top three.

Microsoft, which has an advertising agreement with Facebook in the United States, may want to lock up the site as a source of revenue and keep it away from Google. US ad spending on social-networking Web sites will double to USD 900 million this year, with Facebook and MySpace grabbing three quarters of that, according to EMarketer Inc.

Facebook, a privately held company in Palo Alto, Calif., was the 14th most-visited US Web site in August, with 33.7 million users, according to Reston, Va.-based researcher ComScore Inc. MySpace had 68.4 million visitors, ComScore said.