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Microsoft announces enhanced cooperation with Facebook

by Scott Bicheno on 8 February 2010, 13:51

Tags: Microsoft (NASDAQ:MSFT), Facebook

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Searching for allies

Last week we brought you a couple of pieces of news that have been linked by a recent blog post from Jon Tinter - the general manager of Bing at Microsoft. We informed you that Microsoft is feeling bullish about its search prospects once the Yahoo deal is finalised and that Facebook is starting to rival Google (and Yahoo) as a driver of Internet traffic.

Tinter recently published a blog post entitled "Enhanced Cooperation with Facebook on Search", to insist that the two companies are stepping up their collaboration. Just to remind you, Microsoft bought a 1.6 percent stake in Facebook in 2007 for $240 million. Microsoft was already selling Facebook's display ad for it in the US, and after the deal the arrangement was extended globally.

Somewhat confusingly, for a blog post announcing greater collaboration, Microsoft will no longer sell Facebook's display ads for it, with control moving in-house. What has been expanded, however, is the search experience on Facebook, which is powered by Bing. Furthermore, the rest of the world outside the US will get this Facebook/Bing experience.

"Going deeper in web search experiences with Facebook, in addition to the collaboration we announced last October about bringing public data from Facebook's API into the search experience, will enable us to do great things together for our customers," said Tinter.

This is an interesting strategic move by Microsoft in its continuing struggle to wrest control of the soul of the Internet from Google. Not only does it get a whole bunch more users - Facebook recently announced that it doubled its users to 400 million last year - but it gets a lot more ammunition in its goal to redefine search by making it more personal and informative.

Google needs to tread carefully here. In its desire to grab as big a piece of the mobile Internet pie as possible it is managing to achieve the impossible and make Microsoft look like the plucky underdog it used to be. Microsoft is already intimate with Yahoo, while Apple is growing increasingly antagonistic towards Google. Facebook could be a crucial ally for Microsoft in this battle.

 



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