For Facebook this deal and its decision to hold out for a better offer the the alleged offer from Yahoo! last year which valued the whole company at $1 billion, looks like a clear winner. After the rumours of Microsoft buying a stake in Facebook its finally happened. The announcement was done by head of public relations becoming friends with Microsoft’s marketing chief on her profile page and the 1.6 deal was announced.

Microsoft said the deal which will cost them $240 million as a great win.

According to the purchase Facebook is now worth a massive $15 billion, even though it has failed to break-even even after its predicted revenues of $150 million this year.

We all know what Microsoft is aiming to do. They are attempting to transform itself into a web advertising powerhouse, giving Google a run for its money, and the purchase of the Internet’s hottest property they believe it will play a central role in helping it to achieve this aim.

The deal means that’s it is not just for 1.6%  but for the right to become the exclusive third-party advertising partner for Facebook and to sell its advertising internationally. 

Remember Geocities, acquired by Yahoo! in 1999 for $3 billion, show how potential goldmines can fail to live up to hopes.

However, in our opinion the purchase of only 1.6% isn’t enough to prevent Google from getting its claws into Facebook and eventually purchasing it. This deal could even be the catalyst to make Google get a piece of the action.

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