I saw a story slip out on the wires this morning about Microsoft looking to acquire a 5% share in Facebook at a price that would value it at aproximately $5 billion. This is a company that was started just 3 measily years ago by a 23-year-old Harvard dropout called Mark Zuckerberg.
Of course Microsoft already have a good relationship with the site in the form of an advertising partnership (established August 2006) but owning a stake in the company would allow them to have closer access to the developers and influence the direction that the site takes.
What the direction MS is looking for is open to debate. One consideration is around their strategy to move all elements of their business online in the form of the Live offering. Facebook already allows developers to build their own applications and disperse them throughout the user base, and these vary in type from social photo maps, travel logs and even the ability to bite others and turn them into vampires. So could MS be eyeing up the portal as a future home for some of their own software?
What is certain is that MS will not be the only interested party, and the rumours are already beginning about Google sniffing around for a share too. The fact that neither party is talking about an outright purchase already is the significant value assigned to this newby. Just consider that number again of $5 billion for a 3 year old company in a sector that has already proved just how fickle consumers can be. Wasn't the darling of this area MySpace just a year ago, and before that you could argue it was Friend's Reunited (or Classmates in the US)?
Interest from both giants have certainly contributed to this (bubble-creating?) value of Facebook and if we are to learn anything from other acquisitions I discussed earlier in the year then this price is likely to go higher.
(Interestingly, whilst I am writing this I did a quick search on the topic for other opionion and found sites now saying its value is looking more like $10 billion - that's just within 6 hours of the story being released).
:~Dax~:
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