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Microsoft Targets Google, Yahoo With Online Ad Platform

AdCenter is an online service where advertisers can buy space across Microsoft Web properties MSN and Windows Live. The ad platform lets advertisers purchase display and search ads.
In addition, advertisers would be less likely to pay premium prices on AdCenter, if Microsoft can't deliver results. The company, however, is expected to see a spike in ad sales initially, since prices will be low until the number of bidders for keywords reaches a threshold where demand drives prices higher, experts say.

Besides search advertising, Microsoft believes online video will become a major source of ad revenue. On Wednesday, the company unveiled MSN Originals, an initiative to partner with Hollywood production companies in creating content specifically for the Web.

In the announcement, Microsoft made it clear there would be lots of room for advertisers. Besides the traditional display and streaming video ads, advertisers would also be able to buy product placements in shows, "as well as be deeply involved in the early stages of content creation and production."

AdCenter, which Microsoft first unveiled a year ago at its ad summit, has been available in Singapore and France since last year. The company plans to launch it United Kingdom in June.

Microsoft expects to launch search-related ads on MSN in the U.S. this summer. In the near future, it will also launch ads on Windows Live Mail, Windows Live Spaces, Windows Live Safety Center, Windows Live for Mobile, Office Live and Office Online, and the Xbox Web site Xbox.com.

Meanwhile, Microsoft announced at the summit that it has acquired DeepMetrix Corp., a privately held provider of Web analytics and business intelligence tools for online marketers and publishers. Microsoft said it would integrate DeepMetrix technologies into AdCenter. Financial terms of the deal were not disclosed.