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Three Reasons Microsoft Paid So 'Little' For Facebook
An anonymous reader writes "Microsoft's $240 million investment is much smaller than the rumored $750 million that Facebook sought. Why the difference? Wired Epicenter's Terrence Russell analyzes the deal, and points out three good reasons why Microsoft got a 'bargain'. 'Microsoft Only Needs an Entrenched Position - Ballmer's plan to acquire 100 startups in 5 years is still sketchy, but we got the point -- Microsoft wants momentum. If the company is to go forward as planned then taking a small, strategic piece of Facebook makes sense. Microsoft's financial interests in Facebook's ad platform already exist, so it only makes sense to strengthen that tie as the hype builds.'"
Facebook is close to reaching "jumped the shark" status. I worry that Microsoft dumped a ton of cash into Facebook just like News Corp did for MySpace. As News Corp ramped up ads on the MySpace platform, people defected in droves to Facebook. What happens if history repeats themselves? That's right. People end up on Twitter (owned by Google), and Google didn't have to shell out a quarter of a billion dollars in the end.
lets compare, microsoft make great products (Visual Studio, Sql Server, Office, Windows XP, Xbox, Windows Mobile, .NET, etc) AND is buying 100 startups in 5 years... hmmm, i don't think it's losing its way.
Microsoft needs to get Silverlight out there. $240 million to Facebook is the cheapest method of getting hundreds of millions to install and use it, willingly.
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Any sufficiently advanced incompetence is indistinguishable from malice.
Err.. as soon as the value drops down, people will grab it up. I seriously doubt overpaying for a slice of the pie is somehow going to make people *less* interested in facebook.
MABASPLOOM!
I don't understand people that post comments like this. You joined facebook, then went off to join music/piano player groups on there. Needless to say facebook doesn't work for people looking to meet 42,000 new friends that may or may not be real. That's what myspace is great at. I'm a new musician in a new city, I want to find other bands/muscians/etc, i would go to myspace and see who has a half billion friends and realize they spend more time on myfacespace then playing music, so join them and play music together. Problem solved.
As for Facebook, if you join it, to socialize with your friends, it's completely different. Make an account, find people you actually know on it, add them as friends and login maybe once a week or so. Suddenly your actually able to keep up to date on those 10-15 people without having to call them weekly to find out whats going on. Sure some people freak out about this vast amount of stuff I can find out that your doing, but I only know about it because you posted it on there for the world to see.
I rarely join the groups on facebook, and when I do, I do so with a grain of salt realizing a digital group like that that is rather pointless in the first place. However the ability to add a study group or other real life type groups and post discussions, share meeting times and plans, as well as see everyones class schedule on there. That's what makes facebook useful.
This is why we need to stop putting myspace and facebook into the same group. They really aren't as similar as people keep saying they are. Facebook is for people already with friends that want to keep in touch easier, MySpace is a network for meeting new people and getting new connections.
No, it's not less creepy.
The world's burning. Moped Jesus spotted on I50. Details at 11.
what's Facebook? :-)
Here's my question, and it's sincere, because I'm not a Facebook member:
Why is any of that desirable? Honestly. I graduated from high-school in 1993, and I have a current e-mail address and phone number for the dozen-or-so people who still matter to me from those days. When we move, change contact information, or whatever, we send our little group a quick notification, and life moves on. Why on Earth would I want to be contacted out of the blue fifteen years later by someone who probably hasn't crossed my mind since graduation night (or insert whatever non-school equivalent event suits your purpose)?
An example: my sister is a member. Perhaps six months ago, one of my first real girlfriends from the ninth grade in 1989 sent her a message asking how to find me on Facebook, so that we could catch up. Catch up with what? We haven't spoken in *at least* ten years, and she's apparently churned out a few kids in her mining-town trailer park about a thousand miles from here. We're total strangers by this point with utterly nothing in common, and yet people find it scintillating to imagine this kind of scenario through the magic of Facebook? "So, how have the last ten years of your life been? Oh, fifty pounds you've put on... isn't that something? Four kids? Fantastic." Is that what they call a "reconnection?" No thanks.
Maybe I'm just not much of a sentimental, but if a friendship hasn't stood the tests of time organically, why should I suddenly be excited to drag the corpse up out of its well-deserved grave with Facebook? Some of my closest friends live hundreds of miles away, yet we stay close because of things in common and, you know, other friendship qualities. The most important of these is a willingness to put a little, tiny bit of work into actually being a friend. Maybe that means visiting every couple years, or maybe it's even something as small as keeping my phone number and e-mail information written down somewhere and using either or both from time to time. I do those things for them. Relationships that don't have those qualities are about the last things I want to pursue, and Facebook seems to make it way too easy to be a "friend" without being a friend.
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Inventor of the term 'pardon my French'.
I think a perfect settlement would have been for Microsoft to continue business as normal and innovate all they want, the only restriction being that they not be allowed to buy any more companies. If they are this magnificent well of innovation and ideas, go ahead, show us. 8 years later, with effectively no penalties actually imposed on this company, the best they come up with is a plan to buy 100 web companies in the next 5 years.
What innovations have we had from Microsoft in the last 8 years?
Prior to that we have web based email (HotMail), web browsers,
-USR1
Yes, but how much do you want to bet that Microsoft has some sneaky stuff in the sale contract that prevents FaceBook from selling at a lower price without Microsoft's permission because said sale would diminish the value of Microsoft's investment?
Start a happiness pandemic