Yahoo & Microsoft Deal is a Non Starter

Think Yahoo is worth more than 44B? Well, they think so which is why they will be officially rejecting Microsoft's offer tomorrow. I think this is a blessing in disguise for Microsoft because I don't see how two struggling companies equal a stronger one and Yahoo comes with a lot of baggage. As for Yahoo I think this may be the best offer they get as their downward spiral is not going to increase their market share with time.

Facebook's $10 Billion Dollar Decision

Who would have guessed that Facebook's decision to open their APIs would increase their valuation by 1000% in just one year. That's the valuation Microsoft would be giving them by taking up to a 5% stake for $300-500 million.

If you can't buy them join them...it's a smart move for Microsoft since at least this way they lock out the competition, Yahoo and Google of course. But why would they be interested in Facebook in the first place? Facebook is more than just a social networking site - it's a communication platform that offers many options like social networking and community building. I actually think Facebook is more like Second Life in this way.

But what's in it for Facebook? Charlene Li nails it in her post:

Two thoughts about why Facebook would want an investment with Microsoft.
First, they already are working together. Microsoft sells the display ads that
are targeted against profile information, and will make up about half of the
$150 million in revenues Facebook will generate this year. This is part of a
multi-year agreement that will extend until 2011. And Facebook's unique
marketing value is that not only can the display ads be highly targeted at
actual profile elements, but marketers can also develop a deeper relationship
with Facebook members -- marketer relationships that Microsoft has in spades.

Second, Facebook needs to scale up a business that's both
consumer-oriented and also developer friendly. Microsoft has excellent developer
relationships and also knows a thing or two about how to build successful
consumer (and business -- watch this space carefully)
applications.

I would add one important point – BUZZ! Facebook may just hold out to see if Yahoo or Google dig a little deeper into their pockets. Do I hear a bidding war? As long as Facebook keeps the investment at 5% they have nothing to lose!

Marketing 2.0: "The Less We Sell, The More People Want Us"

I thought the first podcast was good but the second one was even better - Marketing 2.0: Creative Destruction of Advertising - Part 2. Again Eric Vidal, advertising and new media leader at WebEx, talks with Chris Peterson, president and CEO of Chautauqua about Marketing 2.0. Here are my highlights:

Eric starts with his sound bite, "Marketing 2.0 is a shift that has dramatic implications on how Marketing get created, distributed, consumed and responded to."

Chris explains that these implications change the process, skill set and deliverables for marketers. For example there is a shift from a single message to many messages, copywriting to editorial writing and print media to innovative custom packages which he explains as "variations of advertorials."

The most valuable part of the podcast to me were the examples they provided:

• WebEx changed their online banner ads to lead with content including white papers, 3rd party content, videos and podcasts. This resulted in more clicks, more interaction - for longer and ultimately more leads. What they learned from this is, "the less we sell, the more people want us."
  
• A family entertainment park in Austin, TX wanted to increate their number of visitors. They created a 2-3 minute documentary about the park and had employees and customers talk about how much fun they have working and being there.The video was then used on their website as well as new content areas on local family entertainment sites. The friendly, open and honest format is really what got more traction.


• Microsoft took a key business white paper on hosted email services and turned it into a Wiki. They then hired a professional technology journalist (with full exposure) and went to IT message boards and blogs and invited people to edit it and ultimately help shape how Microsoft talked about services. Thousands of people came to the site and participated.

Final thoughts were about getting around naysayers and Chris' advice is, "'just do it and beg for forgiveness later." I have to admit that's been working for me!