Wednesday, November 17, 2010

10 Reasons Why Microsoft Should Buy Facebook:

when it announced its messaging platform, which combines the functionality of e-mail with the quick communication possibilities afforded in SMS and IM. The goal is not necessarily to make Facebook Messages a direct e-mail competitor to services such as Gmail. But the company believes its social platform can supplant the existing services with its quick communications alternatives. 
With that announcement, Facebook has proved that it has big plans for the Internet. And it wants to be a Web platform that does more than help people find out what their high school buddies are up to. By doing so, it has also made itself far more attractive. The company has massive potential going forward. And with the possibility of more than 500 million active users employing its messaging platform, the future could be extremely bright.
That's precisely why Microsoft should consider buying Facebook. Yes, it might seem improbable and the chances of it happening could be slim. But Microsoft has boatloads of cash and investments on its books—over $44 billion as of the third quarter—and can legitimately get its hands on Facebook if it wants to. There are sound reasons why it should want to. Read on to find out why: 
1. The size is obvious 
Perhaps the best reason for Microsoft to acquire Facebook is that the social network is the world's top destination in the world. It has more than 500 million active users who share over 30 billion pieces of content every single month. It's huge and it's growing. It would only make sense for Microsoft to want to capitalize on that growth and find a way to generate serious revenue off of it. 
2. They're already working closely 
Microsoft is already working its way into Facebook. Bing is a key partner with Facebook, powering the company's Web results in its Search. The social network also announced Oct. 13 that when folks search for content on Bing (or Facebook's Search), they will see their friends' "faces next to Web pages they've liked." It's an interesting implementation. And it makes it all the more reason for Microsoft to get its hands on Facebook. 
3. It owns a part of Facebook 
Microsoft currently owns a small part of Facebook. Back in 2007, Microsoft doled out $240 million to Facebook in return for a 1.6 percent stake in the company. That might not be much, but Microsoft has its foot in the door, and it's a good basis from which to start negotiations if the software giant were to ever go through with it. 
4. Microsoft has the financial security to do it 
When it comes to financial security, Microsoft has it. The company currently has more than $44 billion in cash and short-term investments on its books. During the last quarter, it generated a profit of more than $5.4 billion. With that in mind, it can acquire Facebook using both cash and some stock and not have to worry about the long-term financial impact it might have. After all, if it continues to generate such a profit, it won't be long before its coffers are filled back up again.
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