After losing out to Google in its bid to land a partnership with News Corp.'s MySpace, Microsoft is announcing a deal today with Facebook Inc., owners of the No. 2 social network on the Web. Under the
deal, Microsoft will use adCenter to sell and deliver ads for Facebook. The three-year agreement sees Microsoft first providing banner ads on the site, then adding ads tied to Microsoft's Internet
search service. The deal could help Microsoft regain ground it's been losing to Google. Google beat out Microsoft earlier this year for both AOL and News Corp.'s signature in search distribution. Its
search engine, MSN Search, has also been steadily losing market share to the Web search leader. One of Microsoft's biggest challenges is amassing a larger audience of consumers to its Web services.
The deal with Facebook, which is widely popular among college students, could help Microsoft divert more traffic to its sites from MySpace. Executives said Microsoft-delivered ads should start
appearing on Facebook "in the next couple of weeks." The Wall Street Journal
reports that Facebook was also in discussions with Google about whether to use the company's ad system, but opted
for Microsoft's more comprehensive adCenter. Facebook COO Owen Van Natta notes that Microsoft has "a real understanding of the need to take a fresh approach to advertising and social media."
Read the whole story at The Wall Street Journal (by subscription) »