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The Piddling $15 Billion Valuation That The Microsoft Deal Looped 'Round Facebook's Neck

Posted by: Jon Fine on October 24, 2007

Is it really that awful for a company as rich as Microsoft to pay $240 million to lock up the ad inventory on Facebook?

This is a serious question. Microsoft gets to lock up ad inventory on the hottest platform going until 2011, and it gets to play with truly the stupid amounts of data that Facebook’s collected from its users. And it gets to experiment with all manner of ad-targeting in a controlled, but very large, environment. All for the price, in Microsoft’s terms, of, I dunno, a really nice dinner.

If you set aside the valuation and just look at what Microsoft paid as a price-of-admission, it doesn’t sound all that crazy to me.

Reader Comments


October 24, 2007 10:41 PM

My thoughts exactly, I don't see what all the fuss is about over at blogs clocking hundreds of heated comments. Glad to be here.

mark silva

October 25, 2007 7:29 AM

We should all think they paid too much if they can't create a better experience for consumers than the irrelevant, spammy and 1.0 inventory they're currently serving. Better BT via Facebook data exhaust may help. Otherwise Facebook sold futures on distressed and undesireable inventory at a huge premium. We won't be advising our clients to buy the MS inventory in its cuurent state. We are however advocating for ads direct via Facebook that are included in the socialgraph as well as creating applications and widgets that add value, relevance and social utility. These are the activities that drive mutual value and strong returns for brands and consumers. Cheers! Mark Silva, Managing Director,

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