Four years ago, the tech world was abuzz with rumors of a possible merger between Microsoft and Facebook.
It later emerged that Microsoft, which owns 1.4 percent of the social-networking powerhouse, offered Mark Zuckerberg $15 billion for his whole company--an offer that, with the gift of hindsight, he looks extremely smart for having shot down.
Fast-forward to 2011, when the companies are closer than ever. So where are the merger rumors now?
On Tuesday, Facebook introduced a new video chat feature that will be powered by Skype, which Microsoft bought in May for $8.5 billion. It was but the latest partnership between the two tech behemoths.
So far, the pair have teamed up on everything from search integration to a photo analysis tool. Both share a common enemy, Google, which last week rolled out Google+, its new social-networking platform. And last August, Facebook opened its first engineering office outside of Palo Alto in downtown Seattle, a short drive from Microsoft's Redmond campus, and a legitimate cover should Zuckerberg ever have to explain why he's hanging out in the area.
The tech press is as gossipy and breathless as the British tabloids, yet despite all the evidence that the relationship between Microsoft and Facebook is growing ever cozier, no one has uttered a peep (so far) of the possibility that the two might merge. Debra Aho Williamson, an analyst with the research company eMarketer, says that the radio silence is likely due to the intense chatter surrounding Facebook possibly going public, even though Zuckerberg hasn't committed to an IPO.
If some kind of deal were to be made, Facebook would have the upper hand, according to Williamson.
"Facebook has all of the momentum right now in the relationship," she says. "I think it's Microsoft that's more of the underdog."