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Microsoft Moves On, Signs New Search and Ad Deal with Facebook

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Microsoft Moves On,  Signs New Search and Ad Deal with Facebook

For now, Microsoft may have gave up on acquiring Yahoo and lost its only hope of catching up with Google in the search and online ad department. But it wouldn’t just rest that easy and so it has to turn to a new ally in its quest to boost its search and online ad business – Facebook.

Although Microsoft and Facebook already has an existing agreement with Microsoft serving graphic display ads on Facebook pages, it is only now that Microsoft is exploring the Facebook environment as an avenue for beefing up the clout of its Windows Live Search and expanding the coverage of its search advertising service.

The new deal is to be carried out next month and would seem a viable option for Microsoft. But the question is, would this deal bring some good tidings to Microsoft’s underlying goal of catching up with Google in this business? Microsoft wants to establish its online search service as the starting point for consumers to locate a range of digital media and e-commerce services and at the same time be able to deliver ads that would direct consumers to what they are looking for. Now there lies the problem with this deal. Users don’t go to Facebook to do their search. Facebook is not a web portal but a community platform for socializing, checking up on friends and meeting new people. If Facebook users will use a search box, they will use it to explore the Facebook universe and not the whole of the web. Facebook users don’t visit Facebook to click on Ads, they go click on Facebook friends’ updates.

How could Microsoft’s Search and Online Advertising business gain from this new deal then? And how much was the financial terms of this new agreement? Nobody would disclose, as it might prove the old adage “the end justifies the means”, wrong.

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Arnold Zafra

Arnold Zafra writes daily on the announcements by Google, Ask.com, Yahoo & MSN along with how these announcements effect web ... [Read full bio]

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