Rumor: Microsoft will Buy Facebook
Today’s tech news is full of Microsoft, Yahoo — and now Facebook. Microsoft keeps coming up with ways to buy some part of Yahoo. And now the rumor (reported by Robert Scoble) is that Microsoft may also buy Facebook for $15 to $20 billion. All of this in an effort to compete against Google – or as others suggest – perhaps just to survive.
Here’s the argument: One of the advantages Facebook has is that they do not allow Google to index their internal pages. A lot of their content is walled off and only available within Facebook. So if Microsoft did buy Facebook they could own that piece of the web in which Google can’t occupy (but Yahoo could if Microsoft owned Yahoo search).
An open Internet is what Google has capitalized on and is what the Internet is built on. Closing it off may give Facebook more leverage, but so far Facebook and Microsoft haven’t been able to monetize Facebook very well. Combining forces is unlikely to help.
I looked up revenues for the companies: Yahoo is at $7 billion, Google is at $16 billion, Microsoft is at $51 billion. Privately owned Facebook, is said to be at $150 million. Microsoft already has a $240 million equity stake in Facebook, based on valuing the company at $15 billion.
In the background Yahoo is trying to stave off Microsoft and improve their search offering.