Steve Ballmer just not that into Facebook

Give Microsoft boss Steve Ballmer points for consistency. Before the public bid for Yahoo, he said that the software titan had to get big in online advertising and that search-based ads were going to be a significant part of that.

Then came the play for Yahoo, which certainly would have accorded him the advertising scale he wanted.

Now that Yahoo is going its own way -- or actually, is going Google's way -- the Financial Times lobbed Ballmer a softball: Why not skip right over search and go for Facebook or another New New Thing?

The tech blogosphere has been trying to matchmake Microsoft and Facebook ever since Microsoft bought its minority stake in Silicon Valley's hottest firm, and that has intensified since the Yahoo debacle. Heated reports of Ballmer sightings near Facebook headquarters have gotten several commentators in a dither.

But Ballmer wouldn't take the FT's bait. He said:

I think people don’t understand what they’re talking about. At the end of the day, this is about the ad platform. This is not about just any one of the applications. The most important application for the foreseeable future is search. It’s where you start things. It’s where you express intent. It is important.

Hey, actual clarity. Now back to building that pesky search engine.

-- Joseph Menn

Photo credit: Timothy A. Clary / AFP/Getty Images

Comments

[William Jolitz]

Not quite right. MSFT is very much into FB - but the idea isn't ad platform as much as the nature of the social networking business fits hand in glove the insidious, compelling MS grab of the individual. The share they've got is not unlike Disney's early share of Pixar. Getting more now doesn't help, they have to wait for the social networking segment to mature and develop its value proposition more.

As to ad platform, foremost is upping market share, which was what the Yahoo deal was all about, because MS have been arrogant fools about search from day 1. But there are other ways to go after a larger ad platform, but yet again the chief problem is the entrenched MS arrogance kills them over and over again.

Too much success in the core business translates into idiocy in an adjacent business. One approach to this is buying a search firm that's good at M&A as well as capturing market share per dollar, and then scaling that OUTSIDE of MS, where the arrogance can remain. Then at a arms length, stimulate the business with deals/financing/partnerships, hypergrow it, and then AFTER it gets substantial market share, then "acquire" it.

They just don't get that they can't do everything, because their egos can't take the hit. They remind me of IBM when it was struggling with the personal computer market.

[kyle lefkowitz]

Steve is right Facebook is a great site with good clean funstions but as far as being a good business it has not shown one iota yeat of being independently valuable or profitable. I am not talking about the investments microsoft made in them...remember microsoft paid to have sole right to placing ads, not just to get a piece of the company.