Microsoft to Provide and Sell Ads on Facebook, the Web Site

This is a great deal for the folks over at Microsoft. Seriously, I mean is there any real question that allowing this ad deal to go through would be great for both companies?

Microsoft said yesterday that it would provide advertising for Facebook, a Web site aimed primarily at college students, over the next three years.

The two did not disclose the terms of the deal, in which Microsoft will be the exclusive seller and provider of banner advertising and sponsored links for Facebook. The site, a social network that allows users to set up pages about themselves, post pictures and create discussions, attracts a youthful demographic that is highly prized by advertisers.

The deal follows an announcement earlier this month that Google had agreed to pay a minimum of $900 million over three and a half years to the News Corporation to provide search functions and advertising to MySpace.com, the hugely popular social networking site.

Microsoft was one of the competitors for the deal with MySpace, which earlier this month registered its 100 millionth user, compared with Facebook’s 9 million registered users. “It’s basically a consolation prize,’’ Phil Leigh, president of Inside Digital Media, a market research firm specializing in digital media, said of the deal. “But Facebook is also a legitimate test bed, a place where Microsoft can test new technology in a commercial context,’’ he said…. Source: NYT