Today Microsoft announced an alliance with OpenX, the vendor of an open source Web ad server and proprietor of a Web advertising market for smaller publishers. The objective is for
… the companies to cross-market and promote products to their respective publisher bases. Under terms of the multiyear agreement, OpenX becomes a preferred partner to publishers for enterprise ad serving solutions. In addition, OpenX will promote Microsoft’s Content Ads monetization products — as well as other products that may be developed in the future — to its existing base of Web publisher customers.
OpenX and Microsoft will each enjoy significant benefits from the partnership. Most notably, Microsoft will have a major distribution channel for its monetization products through OpenX’s community of more than 150,000 Web sites that serve more than 300 billion ads per month. OpenX will, in turn, gain access to a new base of potential customers — via referrals from Microsoft — for its enterprise advertising technology and services.
The Content Ads component of the agreement follows a successful trial Microsoft and OpenX began in August 2008, during which OpenX provided invitations to its publishers to test the product. Content Ads matches ads to relevant editorial content, allowing advertisers to increase campaign effectiveness, which can allow publishers to achieve a higher yield on certain types of inventory. As part of the agreement, OpenX will promote Content Ads in two ways. First, OpenX will integrate Content Ads so that it can be used by publishers who sign up for OpenX Market to better monetize their pages. The company will also build a plug-in to OpenX Ad Server so existing publisher customers can more easily sign up for Content Ads and implement it on their Web site(s). OpenX is the first reseller approved by Microsoft to build a plug-in for Content Ads.
Content Ads is Microsoft’s competitor for Google AdSense and this agreement is an easy way to add ad volume among third party publishers. It is a natural alliance, since big dog Google has their own free in-house competitor for (hosted) OpenX functionality in Google Ad Manager which naturally provides easy serving of Google’s own AdSense ads.
Bigger publishers would probably set their sights higher than either of the above solutions by using Microsoft’s aQuantive products or Google’s DoubleClick. Still the small publisher business is lucrative and not to be disdained – a view that Microsoft only slowly adopted.
After more false starts than I really care to recall, Microsoft and Yahoo today announced that they had reached an agreement to combine their Web search businesses to better compete with Google. The gist of the deal is that Yahoo is giving up on Web search and hiring Microsoft to handle it for them:
Not called out explicitly is what will happen to the Yahoo Publishers Network and Microsoft PubCenter which are rivals to Google’s AdSense in serving contextual ads to 3rd party publisher Web sites. Presumably, YPN is toast and the fledgling Microsoft PubCenter will assume their publisher relationships.
So where’s the pony? For Yahoo it is pretty clear – they dump the expense of running and monetizing a search engine while Microsoft pays them 88% of search revenue generated on Yahoo’s owned and operated (O&O) sites during the first 5 years of the agreement. (Also "Microsoft will guarantee Yahoo!’s O&O revenue per search (RPS) in each country for the first 18 months following initial implementation in that country.") Yahoo used Google for search from 2000-2004 before they tried to do it themselves – now they have shuttered the in-house effort as a failed project and gone back to a "content site" strategy.
For Microsoft. however, the pony is all in the future. They have irretrievably made Steve Ballmer’s "big bet" on search and purchased a whopping chunk of search market share – approximately 28% compared with Bing’s current 8%. Now they will have to deliver on it. The press release does not explicitly state the conditions under which either partner can ditch this deal, but the chances of it in the next few years have to be exceedingly slim.
Finally, the partners apparently suspect a length regulatory review and the agreement is not hoped to close until early 2010.
Digg is ending its two-year-old exclusive ad selling relationship with Microsoft, one year earlier than the deal was set to expire.
The partnership initially was supposed to last until summer 2010, but the two always had an understanding that Digg would at some point step up to rep the bulk of its own ads, according to Mike Maser, Digg chief revenue and strategy officer. He said the company’s internal sales efforts will focus on custom, non-IAB inventory combined with standardized banner ads.
Digg had been hiring internal ad sales staff and was apparently ready to take off on its own. They will still look to Microsoft to fill any ad slots they are unable to sell themselves.
Another interesting tidbit:
Even though it will work with Digg on remnant inventory, Microsoft remains dedicated to high-engagement ad deals, according to Robin Domeniconi, VP U.S., Microsoft Advertising.
"We want to do custom," said Domeniconi, who was appointed in December to oversee a dizzying array of ad products at Microsoft. Those products — represented by over 1,100 sellers — include MSN, Microsoft Media Network, Live Search, partner deals like those with Facebook and Digg, and game products like Massive and Xbox Live, among others.
Under her leadership, Microsoft is moving away from pitching those products individually. Rather, reps are proposing custom ad packages that combine non-standard advertising, premium display placements, and remnant ads across all its channels.
For instance, Discovery Channel recently graced Microsoft with its entire online ad budget for the fifth-season debut of "Deadliest Catch." High-engagement placements spanned mobile, Web, gaming and other channels.
We’ll see on Thursday how well all this furious ad peddling is working out, but it’s barely a bump on Microsoft’s software cash cows.
Microsoft today announced the demise of their Gatineau Web analytics service before it even left beta:
The Microsoft adCenter AnalyticsBeta team announced today the end of the adCenter Analytics beta program.
The beta has been closed, but the program will remain available to current users through December 31, 2009.
Please note that all hosted services, data collection, and technical support will end at that time. If you would like to save your historical data, please use the export feature to download your reports before December 31, 2009.
The insights you’ve contributed through your feedback and your use of the tool have served an invaluable purpose in shaping Microsoft’s future in this space. You’ve helped us work towards making an informed decision about building a general Web analytics solution, and despite the end of life plan, the beta was very much a success.
It enabled us to confidently determine that we can be of most value to advertisers and publishers by offering a tailored solution that meets more specialized needs.
And with that cryptic pronouncement the team fades into the sunset leaving a list of alternative sources of Web analytics software including the ubiquitous and free Google Analytics which targets the same small to medium publishers as did Gatineau. Sounds like a total writeoff to me, not only for the Gatineau effort, but also for the acquisition of DeepMetrix which provided the technology for Gatineau.