Microsoft, Google want a piece of Facebook

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The WSJ is reporting today that Microsoft is in talks to acquire 3-5% of Facebook for US $500 million, giving Facebook up to a $10 billion valuation.

While rumors have swirled of a possible impending Facebook IPO in recent weeks, Facebook founders have indicated that they’re much more apt to take strategic investments than raise public money.

Microsoft is already in bed with Facebook and best positioned to strike a deal, having signed an agreement last year to be the company’s exclusive advertising partner through 2011.

And though Google has been rumored to be opening up its social graph in a few weeks to compete with Facebook, the Journal says Google and Facebook have also been in talks about a potential investment and future advertising partnerships. It’s clear that the guys over in Mountain View have been thinking long and hard about their strategy in the space.

Update: Facebook’s Brandee Barker declined to comment on the rumors this afternoon.

[tags]facebook,microsoft,google,investment[/tags]