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August 23, 2006

Microsoft's Facebook deal

Posted by Kim Peterson at 10:16 AM

News Corp. said earlier this month that it had talked with a number of large companies about a search and advertising partnership across its network of sites, including the red-hot social networking site MySpace. Google was the most aggressive and ultimately victorious bidder, and the deal was announced Aug. 7, but it seems logical to think that Microsoft was an interested party. After all, Microsoft has a similar partnership already with FoxSports, which was exempted from the News Corp. deal.

Now, we see that Microsoft was pursuing an advertising deal with Facebook, a social networking site that's mainly geared to college and high-school students. In the deal, announced yesterday, Microsoft will provide banner advertising and sponsored advertising links on Facebook pages.

The Google deal seems more lucrative for many reasons, including this: News Corp. will add Google's search box to most of its pages. That way, executives said, people don't have to leave to do a Google search (and MySpace users would leave more for Google.com than any other destination). If Facebook users want to do a Web search, it doesn't sound like a Microsoft search box will be on the site waiting for them. They might have to go elsewhere, to a site Microsoft might not like.

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