After days of rumours, the announcement was finally made yesterday: Microsoft has just paid $240 million USD for 1.6 percent of social-networking juggernaut Facebook, which makes Facebook worth $15 billion dollars. This makes Facebook the 5th most valuable US Internet company (Google is #1, followed by eBay, Yahoo, and Amazon).

Google was apparently also in the running for a piece of Facebook, and there is plenty of speculation going around as to why they were snubbed in favour of Microsoft. The simple reason is of course, that Microsoft had already invested significantly in the social-network startup when they bought the exclusive rights to sell FB's advertising inventory, and they had already agreed to work together on future technology and advertising initiatives.

This week Microsoft made a HUGE purchase, plonking down $6.1 billion for aQuantive, which includes Atlas, Drive Performance Media and Avenue A Razorfish. Following the initial public announcement, the following news bites have been posted over the past two days, highlighting just how rosy Microsoft feels about this deal:

From the New York Post:
"It is certainly a significant transaction and large in the context of what we have done historically, but we think entirely appropriate in terms of looking forward rather than backward," Yusuf Mehdi, Microsoft's chief advertising strategist, said on a conference call to discuss the deal.

From CNET News:
Speaking at the Goldman Sachs Internet Conference, Microsoft Chief Advertising Strategist Yusuf Mehdi said the company does not necessarily need to acquire more scale in order to be a success. When asked whether there would be assets from Yahoo that could help Microsoft, Mehdi said, "From where we are today, I think we have all the pieces."

From ActiveWin.com:
"I would call the aQuantive acquisition more of a merger" than an acquisition, Berkowitz said. He said that he told Microsoft employees the same during an internal Town Meeting on the deal on May 18. Berkowitz characterized the aQuantive buy as an "additive." "It puts us in places where we weren’t before," he said.

Following close on the heels of the Google/DoubleClick merger, Yahoo! made a big announcement this week that they are buying (or have bought) the remaining 80% stake in Right Media, an ad network that they already owned 20% of. Not to be left out of the action, a rumour is going around that Microsoft, who apparently lost out in the bidding war for DoubleClick, have their sights set on 24/7 Media with a rumoured bid of $1Billion. Seems like everyone's banking on online advertising these days to be the ultimate money-making engine of the internet, so let's just hope all the folks out there who actually have to put up with these ads don't start installing ad-blockers. ;-)

In what could be the biggest acquisition in the history of online advertising, Google, once known for their spunky motto "Don't be evil", has acquired DoubleClick, the biggest display-ad delivery company, for $3.1 billion dollars. DoubleClick developed of the successful DART platform which is considered by many to be the best display-ad platform in the business. With this acquisition, it is estimated that Google will deliver as much as 80% of all ads on the internet. The deal still requires regulatory approval but is likely to go through, despite antitrust concerns. DoubleClick was recently reported to be in talks with Microsoft, but any deal that may have been in the works obviously didn't go through.