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Foursquare Gets $15M And Licensing Deal From Microsoft To Power Location Context For Windows And Mobile

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Today, Foursquare is announcing that it has received $15 million in funding as a result of a partnership with Microsoft. The deal will see Foursquare contributing to the Bing platform’s location and context layers on both Windows 8 and Windows Phone.

The funding will be rolled into Foursquare’s previous raise of $35 million in December, bringing the total to $50 million. In addition, a licensing deal has been struck for the location data, but the financial terms of that haven’t been disclosed.

This is not a simple licensing deal for Foursquare’s location data. Instead, Microsoft will be getting the data and much deeper access to its contextual layers than any third party via Foursquare’s API. Holger Luedorf, Foursquare’s head of business development, tells me that this is a multi-year agreement that includes both data and technical components that will integrate with Microsoft’s Bing platform on both Windows 8 and Windows Phone.

Foursquare will expose more functionality to Microsoft’s team than any other platform has access to. Luedorf says this includes Foursquare’s location targeting system that utilizes phone sensor data to pinpoint user locations and points of interest.

“This is a great validation of our platform strategy,” says Luedorf. “We’re positioning ourselves as the location layer of the Internet.”

Luedorf says that the integration will assist Foursquare’s commercial component as well, doubtlessly providing many opportunities for branded results in maps products and other places — and likely increased inventory for Foursquare’s ad products.

Microsoft’s Jon Tinter — General Manager, Business Development, Application and Services Group — tells us that Microsoft is venturing deeper into contextual computing with this deal.

“The more information you have about the user [and their location], the more value you can provide,” says Tinter.

Along this vein, Microsoft will be using Foursquare’s integration with the Bing platform to provide things like proactive notifications, integration with Bing Maps, and more tendrils that touch Microsoft’s devices and services on Windows Phone.

Understanding ‘where the user is’ is incredibly important to Microsoft, says Tinter. This should dovetail well with Windows Phone, which has always provided a more customizable and malleable home screen than other platforms like Apple’s iOS. Integration of ‘proactive computing’ efforts will help Microsoft expand beyond simply allowing people to customize the screen and into the realm of providing users information they need before they even know they need it.

We’ve talked about the power of Foursquare’s technology arm before, especially in the realm of predictive calculation. Make no mistake — while many will focus on the data deal here, the technology that empowers features like Foursquare’s anticipatory push notifications is just as important, if not more so, to Microsoft.

Luedorf says that the partnership will delve far deeper than the API into Foursquare’s passive location technology. “We can take a latitude and longitude and associate it with a place with a high degree of confidence,” says Luedorf.

He notes that the future of search is all about personalization, and Microsoft will be able to use Foursquare’s technology to do just that for its users.

The details of the integrations are still under wraps, but Tinter and Luedorf tell me that they’ll be coming into view over the next several months. The partnership is years long because they feel they’ll need a lot more time to fully explore how deep those integrations can go.

One thing they did say is that Bing and Foursquare will be handing users off to one another with contextual data. This allows the user to ‘come in hot’ with intent information about what they’re searching for and where they are, which should improve results on both sides of the coin.

Because the Bing platform is a system-level service, Foursquare has also just become a system-level service on Windows Phone, which should be interesting. The heat is definitely on when it comes to anticipatory computing, and Microsoft is digging in.