Does Microsoft Deserve Facebook?

    July 17, 2007

First of all, think I’m the only one going gung-ho about Facebook? You’re nuts.

ReadWriteWeb is doing a week of nothing but Facebook.

I added a few more apps to my Facebook profile in the past day. My favorite application continues to be that Google Reader Shared Items one. It demonstrates the best value add that’s out there. It does something that could only be done on Facebook and with Facebook’s platform. Plus he’s been adding a new feature every day or so. Today he added groups to that app and it already is beating TechMeme on speed. I knew that when you study people’s reading behaviors that a new Digg or a new TechMeme is not only possible, but will bring something new to the table.

Anyway, back to my thesis. One of the things I found on the Google Reader facebook application was this post by Fred Wilson, A VC in NYC. In that post he tells why he believes Facebook won’t sell to anyone and if it did it’d get screwed up.

Now I used to advocate for all sorts of companies selling to Microsoft. Why? Well, for one, I thought it was smart for Microsoft to do. It would keep Microsoft part of the new Internet conversation and would bring some badly-needed fresh stream of ideas to its search team.

Now that I’m a Facebook nut case I am starting to care about what happens to Facebook and where it goes long term. I keep hearing that Microsoft is going to buy Facebook. That thought is starting to bum me out. Why? Microsoft doesn’t deserve Facebook.

Why do I say that? Well, Microsoft has remained on the sidelines in the new social services space for far too long. They haven’t bought best-of-breed anything in social software. Not in blogging. Not in photosharing. Not in bookmarking. Not in wiki’ing. Not in live search. Nothing. Not one best-of-breed company purchased.

So, they have no track record that would demonstrate that someone at Microsoft in leadership there “gets it.”

I’m sure they have lots of money to start throwing around, if they wanted to. It’s pretty obvious to me and most of the smart people in the tech industry that Facebook has value. You can argue about whether it’s $2 billion or $10 billion, but it clearly has value that lots of companies would love to have inhouse.

I personally hope it goes somewhere that the leadership will CARE about owning it, feeding it, and taking care of it. To me that means going someplace that has bought other social services. My top choice? Yahoo. Then Google. Yahoo has made a few mistakes with Flickr and its other services, for instance, but they are minor ones. For the most part they haven’t messed with those services after they bought them.

Microsoft has NO track record of buying best of breed social services on the Web and leaving them alone to mature.

The problem is that Microsoft has the money. They can outbid anyone. But I don’t think they deserve Facebook.

I vote for IPO since Yahoo isn’t able to put enough money on the table to close the deal. Readers over on Fred’s blog post say that Facebook should stay private.

What would you do if you ran Facebook?