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Social networking site to share user data with Bing

Facebook announced Wednesday it would begin providing user information to Microsoft’s Bing search engine, repping a chance for the software giant and the social networking phenom to join forces against market-share leader Google.

In making the announcement, Facebook founder Mark Zuckerberg characterized his company’s new business partner in an unusual way: “The thing that makes Microsoft a great partner for us is that they really are the underdog here,” Zuckerberg said. “They’re in a structural position where they’re really incentivized to go out and innovate.”

It’s not the first partnership between Microsoft and Facebook. The software company won a bidding war with Google for a 1.6% stake in the company. The $240 million pricetag raised eyebrows at the time since News Corp.-owned competitor MySpace still held a larger market share.

While Google was never mentioned by name, Zuckerberg and Bing senior VP Yusuf Mehdi obliquely referred to problems with “search” in general and with “the incumbent.” Google, meanwhile, has been anticipating the new competition.

Marissa Mayer, Google’s veep of search product and user experience, announced an unexpected change of rolesTuesday ahead of Bing’s HTML 5-enabled relaunch. Google also recently redesigned its default search platform as Google Instant.

For its part, Facebook has been slowly rolling back privacy protections for user data, drawing criticism from users and watchdogs. In doing so, Facebook appears to be balancing popularity against revenue, according to Mark Rotenberg of D.C.-based advocacy org the Electronic Privacy Information Center.

“Facebook is caught in a bit of a bind,” Rotenberg said. “Their business model kind of relies on getting user trust to reveal information for friends and then converting that user trust into a commodity that can be sold to advertisers and business partners.”

EPIC has in the past filed complaints against both Facebook and Microsoft with the Federal Trade Commission, alleging that users provided their personal information with the understanding that it would only be shared with friends.

Zuckerberg dismissed privacy concerns Wednesday, noting that users can opt out of the Bing Facebook module and that the info Facebook will feed Bing can already be seen by 500 million Facebook users.

“Given that, why shouldn’t applications be able to do that, too, in order to give you an awesome experience?” Zuckerberg asked.