How Would The Y!-M Merger Dictate The Fate Of Social Networking?

Be it the Facebook or MySpace.com or other social networking sites, the merger does hold a promise of changing the landscape of social networking. If the merger does materialize it could very well be expected to cash in on the social-network advertising market.

While it is true that the duo individually own an array of social networking sites but the don't command the market in a big way. The only social media property owned by them which can be considered big is Yahoo's Flickr. As far as Microsoft is concerned it lags far behind.

It could be safe to assume that the social networking arena can be quite promising for the merger because, even Goliath Google doesn't command a big chunk of the market. While Orkut has experienced some great regional success, its OpenSocial isn't ready. Despite Orkut's success the Q4 earnings from social advertising haven't performed as expected.

It would perhaps be better for Y!-M to try and attempt cashing in on the advertising market, because launching a social media initiative could be a difficult thing to pursue as there are so many players out there. Though Microsoft already has a $240 million holding in Facebook.

A merger is likely to allow an ease of carrying out business with Facebook. The present scenario entails Microsoft covering display advertisements only and not search ads. Facebook might feel comfortable doing business with the merger, and perhaps later be acquired. Apart from the initiatives both the entities have a whole reservoir of e-mail address books, instant messaging contact lists, which can be quite worthwhile for them and can be considered a social graph.

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