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The investment may be $300 million to $500 million, giving Facebook an overall value of $10 billion, the newspaper reported on its website, citing unidentified people familiar with the matter. The talks are still preliminary, and Google has also expressed interest. For Facebook, the talks come about one year after a proposed deal with Yahoo collapsed. Facebook then was said to be seeking more than the $1. 65 billion Google paid for YouTube and considerably more than the $580 million News Corp. paid for MySpace in 2005. This move by Microsoft will help bring the software giant further into the realms of the internet. While already synonymous with operating systems and office productivity software, the company hasnt really taken off in areas that rival Google has exceeded in. Investing in Facebook will offer a jump-off platform to get new online software out to the public. There has already been cases of developers selling their applications after theyve become popular on Facebook. News of the talks between Microsoft and Facebook came on the heels of reports of a high-level, confidential meeting at Google on Friday 21. 9. 2007 in which several executives and investors discussed Facebook. Participants were required to sign non-disclosure agreements, but Michael Arrington of the blog TechCrunch reported that three participants said Facebook was the central topic. He reported that a group of industry luminaries attended a cloak-and-dagger meeting at Googles headquarters to discuss how to deal with Facebook, whose 40-million-plus users arent the issue so much as its open development platform. Arrington said not one but three sources fed him the info. If there is a shred of proof to this leak, I cant help but believe Google has abandoned its attempt to grab a stake in Facebook and that this move is a declaration of all-out war against a company it perceives as a threat to its online advertising business said Joe Wilcox of Microsoft Watch . If there is any fact to the rumours, one thing is for sure Microsoft and Facebook are keeping quiet on any negotiations that are taking place. It develops, manufactures, licenses and supports a wide range of software products for computing devices. Its headquarters are in Redmond, Washington, USA. Although, best selling products are the Microsoft Windows operating system and the Microsoft Office suite of productivity software with which Bill Gates got in line with his vision to get a workstation running our software onto every desk and eventually in every home. These products have prominent positions in the desktop computer market, with market share estimates as high as 90% or more as of 2003 for Microsoft Office and 2006 for Microsoft Windows. Microsoft was founded to develop and sell BASIC interpreters for the Altair 8800. However, they rose to dominate the home computer operating system market with MS-DOS in the mid-1980s. On November 20, 1985, Microsoft released its first retail version of Microsoft Windows, originally a graphical extension for its MS-DOS operating system. In 1989, Microsoft introduced its most successful office product, Microsoft Office. In addition, the true glory came with Windows 95, since more than a million copies of Microsoft Windows 95 were sold in the first four days after its release. March 13, 1986 the company went public with an initial public offering (IPO) in the stock market. Starting initial offering price was $21. 00 and at the end of the first day of trading the price stopped at US $28. 00. Moreover, due to the ensuing rise of the stock price, it has made four billionaires and an estimated 12,000 millionaires from Microsoft employees. The greatest projects that followed were: Internet Explorer, MSN, Windows 98, Xbox, Windows Vista, other versions of Microsoft. On the other hand, throughout its history the company has been the target of criticism for various reasons, including monopolistic business practices both the U. S. Justice Department and the European Commission, among others, brought Microsoft to court for antitrust violations and software bundling . Finally, future projects of Microsoft are best illustrated with next words: â€Å"We’re focusing more on research than ever. We’re building the technology that will enable computers to see, listen, speak, and learn so people can interact with them as naturally as they interact with other people. — Bill Gates, Microsoft chairman and chief software architect . The power of buyers is the impact that customers have on a producing industry. In general, when buyer power is strong, the relationship to the producing industry is near to what an economist terms a monopsony – a market in which there are many suppliers and one buyer. In our case, we can speak about oligopoly, few corporations share the market and there are many customers . Microsoft has got a dominant position on the market of the computer technology, but one the internet technology, Microsoft is sharing the market with the giant Google. Microsoft has got a competitive advantage with its feedbacks, it has been successful. This table outline some factors that determine buyer power and the application of those factors in Microsoft case . Buyers are powerful if:Microsoft case: Buyers are concentrated- few buyers with significant market share Microsoft has an important place on this market but is not the number one3 Buyers purchase a significant proportion of output-distribution of purchasesMicrosoft is going to obtain 5% of the society at $400 millions Buyers possess a credible backward integration threat-can treaten to buy producing firm or rivalMicrosoft has already demonstrated its abilities hen he worked with Dream works (creation of DreamWorks interactive or its accord with Matsushita, MTV and Tivo in the multimedia technology3. In our case, Microsoft has a lot of threats that will allow it to create this alliance with Facebook. Microsoft is the most powerful industry in its sector and has already demonstrated its abilities in different alliances. Furthermore, Microsoft has a powerful financial stat ement what is an interesting element for Facebook. Microsoft is in negotiation with Facebook to buy 5% of its capital investing between $300 millions and 500% millions . This investment could increase the value of the website at $10 billion. Thanks to this investment the website will become an important actor on the virtual world, and it represents a powerful advertisement platform. This increase in value will permit to discourage the competitors. This alliance will help Microsoft because today, Microsoft has some problems integrating the new web 2. 0. The company has cumulated an important delay in the development of advertisement platform on line. Microsoft failed in the alliance with AOL, EBay, Myspace (investment in advertisement system) against Google and Yahoo. Face to Google, Microsoft takes this new opportunity to improve its situation and relies on Facebook to take some shares of the market . The participation of Microsoft will offer to Facebook some news possibilities to develop with a good partner staying independent. A producing industry requires raw materials-labour, components, and other supplies. This requirement leads to buyer-supplier relationships between the industry and the firms that provide it the raw materials used to create products2. Supplier, if powerful, can exert an influence on the producing industry. The following tables outline some factors that determine supplier power. Suppliers are powerful if:Facebook case: Credible forward integration threat by suppliersFacebook has already worked with partners and with success. It received $500,000 from Peter Theil, co-founder of PayPal. It was also able to get $13 million from Accel Partners, who are also investors in 15 other Web 2. 0 startups, and $25 million from Greylock Partners, making their overall venture equal to approximately $40 million . Suppliers concentratedIt’s not the case of Facebook. They did not concentrate with other suppliers. Customers powerfulCustomers of Facebook are really powerful, they can influence future of Facebook. Customers can influence each others against Facebook. Facebook has a lot of interest in working with Microsoft. Facebook needs partners to develop and because Facebook needs financial investment. Doing an alliance with Microsoft, Facebook will improve its technical skills and increase its finance. Actually, Facebook has more than 40 millions subscribers, it corresponds to an increase of 63% in comparison with the 24 million subscribers in May; and the website quickly won parts of the market against its main competitor Myspace, property of News Corp. The social website Facebook has known a spectacular success. It has more than one million new subscribers each month and its goals is to have 60 million at the end of the year. The main interest for social websites is to have advertisement revenues with appropriate ads for each customer.