September 26, 2007-The Wall Street Journal
Microsoft Fires Volley
At Google in Ad Battle
It Seeks Facebook Stake,
Names New Executive
To Close Internet Gap
By KEVIN J. DELANEY, ROBERT A. GUTH and VAUHINI VARA
September 26, 2007; Page A1
The battle of titans between Microsoft Corp. and Google Inc. over the future of the Internet is about to get even hotter.
Microsoft is in talks to buy a minority stake in the popular social-networking Web site Facebook Inc., a sign of a new urgency by the software giant to jump-start its online business at a time when Google is widening its lead in the fast-growing Internet-advertising business. As part of its catch-up program, Microsoft also has quietly granted broad powers to an executive recently hired from outside the company, who is expected to help shake up the software giant's online business.
Microsoft in recent weeks approached Facebook with proposals to invest in the startup that could value the fast-growing site at $10 billion or higher, said people familiar with the matter. If those talks bear fruit, Microsoft could purchase a stake of up to 5% in the closely held startup, at a cost in the range of $300 million to $500 million, the people said.
But Microsoft must first outgun Google, which has also expressed strong interest in a Facebook stake, according to people familiar with the matter.
Facebook's Traffic
The existing deal is expected to bring in about $75 million for Facebook this year and a total of at least $200 million to $300 million through 2011, say people familiar with the matter. The actual numbers will depend on Facebook's traffic growth and other factors, these people say. The existing agreement covers only the U.S. and expires in 2011, but the companies are discussing whether to extend it for a longer period and expand it beyond the U.S., this person said.
Microsoft fires volley @ google.
Microsoft fires volley @ google. -
25-09-2007, 04:20 PM
