Microsoft Wins Facebook Deal

Facebook's been the belle of the ball since this spring, when it opened its virtual doors to one and all. Surpassing MySpace in growth, Facebook has been the subject of rumours for months, since Google and Microsoft have been vying for the social media mammoth's affections.

Looks like Microsoft has scored the deal, announcing a $240 million dollar investment yesterday. Microsoft will buy a 1.6% stake in Facebook, an optimistic bet on the future of social media.

The deal will benefit both companies: Facebook, like other social media sites, has more buzz than income, and Microsoft has been struggling to stay competitive against online ad leader Google. Facebook's detailed user information, including demographics and tastes in music, movies, and activities, allows for pinpoint ad targeting.

Additionally, the WSJ sites concerns that Facebook had regarding monetizing its site outside of the US, particularly as they launch non-English versions of the site. The new deal has Microsoft selling ads on Facebook's international sites through 2011.

Facebook has grown exponentially since expanding its membership base beyond students. Opening its platform to developers to allow for the creation of branded widgets has made it even more popular.