Friday, October 26, 2007

Face(book)ing Up to A New Reality

So Microsoft pays a bucket of cash for a thimble full of Facebook. Congratulations to the young man who established himself as yet another digital billionaire... those few years of hard work have really paid off!! (must break the hearts of those families who amass those sorts of fortune over generations... but this is business at internet speed!!)

Behind the headlines are some interesting stories. I have read three articles on this and so I still have to learn a lot more about it, but a couple of interesting tidbits come out. The first big one (and the topic of this blog) is that as part of the consideration, Microsoft secured the rights to sell banner ads (display ads in industry parlance) on facebook pages in all locations outside the US. Now THAT is interesting...

Microsoft has bought a business in which they are buying the advertising rights.... no talk of "platform integration" and "technology" ... this is all about traffic, customer profiles and marketing .. at least from my initial reading.

And all this a few months after they bought a company that sells an online advertising management platform.

1 comment:

geoff said...

This is another 'point solution purchase' that only time will tell the worth of. The unfortunate think about this is that it helps perpetuates the myth that online = advertising. Why a company as supposidely sophisticated as Microsoft would value a company on the basis of its possible ad revenue is beyond me. Why, because web 2.0 has moved on from banner ads to targetted digital communication. People, for goodness sake forget the sheer growth of web 2.0 folk and start thinking about how you can form a relationship with those who mean something to you and your brand! Places like Facebook are important and exciting, but not everything is about the number of people in a new social network that you can banner-ad to! Good on you Richard, keep trhinking, keep asking and keep challenging!