I'm so tired of hearing about Facebook that I don't feel right about proliferating the BS without using a new name -- Farcebook -- catchy, yes? (though still hypocritical)
Just my opinion, but I suspect MSFT negotiated the farcebook move with three takeaways:
- MSN LiveSearch as default search within farcebook. Over 600MM searches/month is compelling.
- Exclusivity on ad representation/sales for certain ad types. Probably not ALL ads, but enough clearly. They already had this deal, but probably added to it.
- Access to social graph data for MSFT's competitor to AdSense.
Farcebook is getting ready to announce some sort of SocialAds deal in NY next week. I would suspect they're expanding their Flyers service in some way. But what I doubt they'll do is distribute their advertising across the Web, like AdSense. But MSFT absolutely needs to do this.
MSFT now has all the advertising tools, sales people and agency relationships (through the aQuantive acquisition). What they lack are the publisher relationships and a compelling reason for publishers to switch from AdSense to their content network. Microsoft will launch an AdSense competitor which will not only utilize the profiling data/targeting from aQuantive but also the social graph from Facebook.
Here's where this potentially hurts Google. AdSense pays for shit. The AdSense ad unit is dead, from the standpoint of the creative life cycle -- people are now blind to it. And Google's content network is responsible for the vast proportion of their ad delivery. Publishers would gladly swap that program out and try something new, if there was enough buzz and especially if there was a fresh design.