Facebook Sells Little Toe to Microsoft for $250 Million

by David Evans on October 24, 2007 in Finance

Big news, Microsoft paying $240 million for a sliver of Facebook, 1.6% to be precise. What does this mean to the user? Not much, It’s just corporations doing business with each other.

Google has a $900 million ad revenue sharing deal with Myspace. Microsoft gets same along with with equity in Facebook. Don’t forget, the two have been in bed together for over a year. Microsoft will do whatever it takes to keep Google in it’s crosshairs and I for one I don’t blame them.

How scared is Microsoft? It paid $6 billion in cash for aQuantive earlier this year, a deal many though was way overpriced.

I like how the Microsoft press release says they have a $240 million equity stake at the next round of financing at $15 billion. Paid Content says “thereâ€™s still room for some private equity or other strategic players to come in.”

I wondered if MS will ask Facebook to move to the Microsoft platform? Short answer, third-party app-makers will have “new opportunities” to tap into MSFT technology and ad platform.

Takeaway quote: “There’s certain aspects of the agreement that both parties have agreed not to disclose.” Of course there are. The conference call was weak on details, corporate PR-speak at its finest (or worst).

Microsoft know how to play nice when they have to. Remember when Microsoft gave Apple $150 million a few years ago to help keep it afloat?

For more details, read Brad Stone’s take on the Microsoft-Facebook deal in the New York Times and check out Silicon Alley Insider, which wrote a transcript of a call with Owen Van Natta, chief revenue officer, Facebok and Kevin Johnson, head of platforms/services, MSFT. More details as well at TechCrunch.

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