Facebook, the number one social networking site among college students has a new partner in software and services behemoth Microsoft. The granddaddy of operating systems who has ambitious plans for its MSN unit announced its biggest deal to date yesterday, saying it would be the exclusive seller of banner ads and sponsored links for the super hot college networking site. Terms of the deal were not disclosed but I don't think we are talking about Google/MySpace like numbers here. (The Google/MySpace deal was a minimum of $900 million over 3 years). However, even if the Microsoft/Facebook deal is for 10% of Google/MySpace which would be $90 million, I still think that's of value for Facebook, who, according to many people familiar with the company only generates about $1 million per month in advertising sales. Remember, this was the same company that was rumored to be asking up to $2 billion as an acquisition price or about 4 times what Fox paid for MySpace. So, who is this a better deal for? I actually think it is quite even. For Microsoft, there sales people can go out and aggressively sell the demographic du jour and a prized brand name with fantastic brand recognition among online media buyers. For Facebook, the deal can finally get some worthwhile ad revenues on their books.
Comments