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Microsoft takes $240m stake in Facebook

But Frank speculated after the call that the partnership could easily grow. "I think [Microsoft] may get more. I think that the language of the press release, which is always rather contrived, emphasises what they agreed to emphasise at this juncture but I think they left the door open for a whole lot more stuff down the road," he said. "Microsoft will continue to have influence beyond just being an ad platform."

But on the call, Van Natta and Johnson repeatedly referred to it as an expansion of an existing partnership. When asked what had happened with Google, widely rumoured to be another major bidder in the Facebook stake competition -- and which serves the ads for Facebook's chief rival MySpace -- Van Natta answered that it was because the partnership with Microsoft was already in place.

Van Natta said: "We were very fortunate to have a lot of folks that were interested in partnering with us around advertising. We've been working with Microsoft for over a year now in the US, and it's been a partnership that's been really great for both of us."

Speaking to journalists near the end of Google's Analyst Day, Google CEO Eric Schmidt said "it's not appropriate for us to comment without taking a look". He added that Google is "very happy to work with Facebook and anyone else" but when asked if his company had been in talks to acquire the stake, Schmidt said he "would rather not talk specifically".

Much of the fine print on the Microsoft-Facebook deal has not been disclosed, including the specifics of how the advertising strategy will work -- which goes into the question of exactly how much Facebook user-data Microsoft will have access to. Van Natta said: "User trust is core to what it is that we focus on every day at Facebook," but would not provide details.

The executives also asserted there will be no new rules or restrictions on the thousands of developers who have been working with Facebook since the social networking site opened its platform to third parties in May.

As for the rest of the social networking world, Gartner's Frank said even Facebook's competitors should consider the Microsoft partnership a good sign overall.

He said: "Clearly a rising tide floats all boats, and so the fact that Microsoft is making a big commitment to the medium itself will probably help the overall sector because it gives it credibility, and gives it some long-term interest from a pretty serious company. The effect on the sector probably outweighs any competitive effects because if the sector grows as fast as Microsoft seems to think it will, there should be a lot of room for growth for a lot of different players beyond Facebook."

But, Frank added, there's still some uncertainty involved. "There are still risks inherent in the category of advertising in social media. I think that no one has figured out the perfect formula for it... There's risk around trust factors and privacy that haven't really fully been explored. I wouldn't say that the market is anywhere near mature enough to call it risk-free."

CNET.co.uk's sister site News.com's Elinor Mills contributed to this story

Caroline McCarthy writes for News.com