So according to Microsoft's calculator, Facebook is worth£7.3bn. That's pretty good going for a site that's only existed for threeyears. But should this Web 2.0 deal make us afraid of Bubble Burst 2.0?

Microsoft has just handed over a £117m wodge of cash for aneffective 1.6 per cent stake in the social networking site. The prize? Exclusivethird-party advertising rights on a site that's gaining 200,000 new users aday.

Back off Google!

On the surface, then, it's easy to understand why Redmond was so keen toget in on the act - and shoulder past Google in doing so. The demographics makesense too - with 60 per cent of Facebook's users outside the US, it is by far the most globalsocial networking platform in existence.

This global perspective also brings Google back into the argument. As Jupiter Research points out, Google completely dominates web search traffic in the UK, France and Germany, while in the US its share is only 54 per cent. This may be all about Microsoft gaining enough traction in non-US markets to offer a viable advertising platform to Google.

And beyond the advertising potential offered by the currentdeal, the possibility of integrating its instant messaging technology intoFacebook in the future must surely have also occurred to Microsoft. Plus there's the not-to-be-underestimated lure of a high-profile success over one of its big-hitting rivals (because Microsoft sorely needed one).

Will the Web 2.0 bubble burst?

But to me it's also the clearest sign yet of the beginningsof an over-inflation of the Web 2.0 bubble. I'm not talking late '90s scale,but the signs are slightly worrying.

Ultimately, Facebook's value is based entirely on its userbase and the potential for growth - and revenue - that the current rate of sign-up suggests.Given how easily both those factors can change, it's a worryingly thinfoundation to build such a high valuation on.

And while Microsoft is in a theoretically strong position inbeing advertising partner to such a fast-growing site, that is also unlikely tobear fruit immediately. Online advertising continues to be a tough nut tocrack, and personal profile-generated ads has more potential than profit at this stage.

Is this a silly money move?

There's no guarantee that Microsoft will ever generate £117m ofprofit from this partnership. Or to put it another way: When was the last timeyou clicked on an ad in Facebook? Or Gmail for that matter? For me, the answeris, as of now, that I never have.

Of course, Microsoft's size means it can afford to be wrong herewithout any serious consequences. But if we're going to start seeing silly moneychanging hands for a stake in businesses with value that's more suggested thanreal, I'm going to start worrying.

Because we've been here before, and it didn't end well.