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Facebook Inc. (FB) Expands FBX with AOL Inc. (AOL) Alliance

Facebook Inc. (NASDAQ:FB) – a stock owned by 67 equity hedge funds that we track, a 40-percent increase over the third quarter of 2012 – started its Facebook Exchange for advertising less than a year ago, but it has established itself as a revenue machine for the social network. Now, apparently the FBX will likely expand as AOL, Inc. (NYSE:AOL) has apparently agreed to integrate its $600 million ad sales network into the exchange, allowing AOL clients to buy space on the Facebook platform.

More specifically, AOL, Inc. (NYSE:AOL) Networks site Advertising.com has signed on with Facebook Inc. (NASDAQ:FB) to utilize the Facebook Exchange platform. The FBX is an opportunity for outside vendors to buy advertising space on Facebook using the same data analytics and marketing strategies that those outsiders use on other Web pages to target customers. Facebook’s exchange has grown so much that it generates a billion impressions per day, and Facebook ha a different advertising program in effect as well that generates advertising based on data and information about Facebook users.

Facebook Inc. (FB)In announcing the alliance, AOL Inc. (NYSE:AOL) Networks chief Ned Brody blogged,  “We know that advertisers want to include Facebook inventory in their buys — we’re seeing it on RFPs — so we’re glad to be able to further meet their needs.” Advertising.com reportedly accounts for $600 million in ad sales each year for AOL, so this is likely the largest FBX client for the fledgling network. And if Brody’s Advertising.com client base is thirsting for the Facebook platform for tis ads, Brody may likely leverage this alliance with Facebook to entice new customers to use the AOL Networks instead of Google Inc. (NASDAQ:GOOG), which currently does not have an alliance with Facebook Exchange.

What do you think about this new partnership? Is this a win-win for both companies, or does Facebook Inc. (NASDAQ:FB) or AOL Inc. (NYSE:AOL) come out better in this deal? Do you see either company being hurt by this? Let us know your thoughts in the comments section below.

DISCLOSURE: I own no positions in any stock mentioned.

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