Facebook Won't Help Microsoft

In August, Google commanded about a 64% share of the search market compared with 60% a year ago. Microsoft, meanwhile, dropped to 8% from 12% over the same period.

Then came the battle between Microsoft and Google to push further into the online display advertising market. After Google swooped in to acquire the ad-serving firm DoubleClick from under Microsoft's nose for $3.1 billion, the software giant resorted to reaching deep into its pockets to shell out $6 billion for the online ad firm aQuantive, a sum that valued the company well over twice where its stock was trading at just the day before.

Now comes Facebook. Indeed, the stratospheric valuation of $10 billion exceeds even what Facebook insiders could have hoped for only a few months ago. "If we got an offer from someone for $10 billion, we probably would listen to them," Peter Thiel, a venture capitalist who has invested in Facebook, said in a media interview in July. But Thiel went on to concede that "I don't think we're going to get that offer, and we're not going to solicit it."

It's true that Facebook's is expanding rapidly: It grew 132% year over year with 26 million people visiting the site, according to data from research firm Compete.com. Traffic on Google's YouTube, meanwhile, was up only 97.6% over the same time frame, with 46.8 million people visiting the site.