According to John Furrier, Palo Alto is abuzz with both Microsoft and Yahoo execs.
His take is that after Microsoft consummates the current deal it has put on Yahoo’s table to acquire their search business, they’ll be wandering down University Avenue to knock on Facebook’s door (with a multi billion $ check in hand).
I haven’t had this verified, but can see how it would fit into Microsoft’s strategy. They already own a small piece of Facebook and given the social network’s recent bad rap it may be an opportune time for them to swoop.
UPDATE: Robert Scoble is also confirming the rumors swirling. Don’t bother going to the Garden Court Hotel (pictured above) for a sticky beak at what may be one of the most important deal talks ever in the history of the Internet, the meetings are taking place elsewhere.
UPDATE II: The blogging echochamber has been resonating with the continued vibration that Facebook is in Microsoft’s sights. Kara Swisher tells us that Mark Zuckerberg has denied the rumor. But who remembers how the YouTube founders adamantly told us they would never sell.
The beauty of the echochamber is that we also get some sound analysis emerging. Umair Haque makes some good points. I totally agree with him that it would be nuts for Microsoft to make the acquisition and then keep Facebook closed:
…only openness can maximize the value of network effects in this space, because there are no hard technological switching costs creating lock-in.
Facebook may become an integral part of Microsoft’s web plumbing, but to close its spigots would drive down its acquistion value.