Number one social networking site Facebook and Ten Network are talking about an alliance that would involve sharing of content, audiences and advertising income, The Sydney Morning Herald reports.

The arrangement would result in Ten Network having Facebook as its digital content provider which would improve Ten's media assets when it seeks more advertisers. As it is, Ten has offered advertisers its ability to book simultaneous ads on DMG radio network, which is partly owned by Ten Chairman Lachlan Murdoch, and outdoor sites through Ten's Eye Corp division.

In turn, Ten would integrate content for some of its bigger shows onto Facebook platform. Facebook would gain more access to Ten's content and a foot into Ten's Australian business. Facebook has 10.2 million users in Australia, with more than 50 per cent who log daily, which would boost further revenues of Facebook Australian to $60 million from $50 million last year.

Until the deal with the social networking site, Ten was marked down by the market for lack of digital strategy.

Ten Chief Executive James Warburton said on Thursday that the network would make an announcement soon about the result of its ongoing discussions with Facebook.

However, analysts forecast that before Ten's turnaround strategy would work, its financial performance would first worsen before it improves. In the six months to February 2012, Ten's TV advertising revenue slumped 11 per cent which caused the company's share in the industry to decline to 6 per cent.

"We need to see some stabilization in the primary channel audience to get comfortable about the revenue (and earnings) outlook for Ten," The Australian quoted Citigroup equity analyst Justin Diddams.

"We maintain a buy rating based on valuation upside, potential catalyst from Eye review, and expectation of improved ratings in H2. However, we remain cautious that ratings will take time to monetize and expect significant content investment will be required on a multi-year view," UBS analysts Lauren Moran was quoted by The Australian.

Mr Murdoch announced on Thursday that Eleven, Ten's free-to-air digital channel, entered into a joint venture with CBS to supply programming which will provide the company with a 33 per cent share of net profit after tax, estimated at $5.3 million for the first half of 2012.

Ten appeals more to younger viewers with their irreverent approach to news although it also has some supposedly serious shows.