The Future of Facebook - Will Yahoo or Google Buy

Microsoft is in talks to buy a minority stake in Facebook, a sign of a new urgency by the software giant to jump-start its online business at a time when Google is widening its lead in the fast-growing Internet-advertising business.

As part of its catch-up program, Microsoft also has quietly granted broad powers to an executive recently hired from outside the company, who is expected to help shake up the software giant's online business.

Microsoft Corp. is mulling an investment in Facebook Inc. that would value the rapidly growing online hangout at $10 billion or more. Zuckerberg, owner of Facebook, rejected a $1 billion acquisition offer from Yahoo Inc. last year.

With more than $100 million in annual revenue, Facebook is believed to be a prime candidate for an initial public offering of stock next year or in 2009.

If Facebook's talks with Microsoft heat up, it could draw online search leader Google Inc. to the negotiating table, too.

Yahoo's acquisition rampage continues...