Microsoft Buys Advertising Software Maker Rapt

Microsoft said Friday that it acquired Rapt, a San Francisco-based developer of yield management software and services for Web publishers.

Financial terms of the deal were not disclosed.

Rapt's products include Price Director, Inventory Manager, and Business Advisor. They're designed to help online publishers improve the pricing and provisioning of online ads. Its customers include Dow Jones, The Weather Channel, and NBC Universal.

Microsoft senior VP Brian McAndrews said in a statement that the acquisition will help the company build "an end-to-end solution" for Web media publishers.

Microsoft said it would add Rapt's offerings to its Atlas Publisher Suite -- a part of its Advertiser and Publisher Solutions Group.

Microsoft is placing a broad range of products and services within APS, including its AdCenter search listings purchasing tool and agency services offered by Avenue A/Razorfish -- which was part of aQuantive. Microsoft acquired aQuantive last year for $6 billion.

The unit will also include services for advertisers looking to place spots within video games and other digital products that represent new frontiers for Madison Avenue.

Microsoft is making other moves to bolster its digital advertising business.

Last May, the company acquired Screen Tonic, a European manufacturer of software designed to connect online advertisers with users of mobile phones and other digital devices. In July, the software maker announced a partnership with Ask.com under which customers of Microsoft's paid search programs will see their listings appear on sites operated by Ask.com and its partners.

The moves are widely seen as an attempt to improve Microsoft's ability to compete against Google and Yahoo as a provider of search advertising. In its most recent fiscal year, Microsoft reported $2.47 billion in revenue in online services, including advertising -- an increase of 7.4% over the previous year.

Microsoft is also looking to buy Yahoo for about $41 billion. To date, Yahoo has rejected the bid. The Wall Street Journal on Thursday reported that the two companies held informal talks earlier this week to discuss the offer.