WPP and social-networking service LiveWorld have formed a joint venture (named LiveWorld-WPP) to provide online community and social networking services - blogs, buddy lists, message boards, chat rooms and community sites - to major brands worldwide through WPP's global networks, reports AdAge. The two companies have collaborated in the past, most recently on Dove's "Campaign For Real Beauty" from WPP's Ogilvy Interactive unit.

"Major brands worldwide are embracing online community as the basic marketing construct of the new generation," said Peter Friedman, Chairman and CEO, LiveWorld, in a statement. He says consumers don't mind being part of a community built around a brand as long as they can build relationships with other people who have common interests. The brand, meanwhile, gains deep insight into consumers.

As part of the deal, WPP has the option of purchasing a $2.1 million stake in the company if it exercises a warrant to purchase one million shares at $1 each and another million at $1.10 each. Recently, IPG Media purchased a 0.5 percent stake in Facebook and agreed to spend $10 million with Facebook on behalf of clients.