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July 26, 2007

Microsoft acquires AdECN exchange for Web display ads

Posted by David Hunter at 6:33 PM ET.

Today at the Microsoft Financial Analysts Meeting, Kevin Johnson, president of Microsoft’s Platforms and Services Division had a little news to keep the analysts awake – Microsoft to Acquire AdECN:

Microsoft Corp. today announced it has agreed to acquire AdECN, Inc., an advertising exchange platform company based near Santa Barbara, Calif. AdECN’s technology serves as a hub where advertising networks can come together in a neutral, real-time auction marketplace for buying and selling display advertising. 

There is more information on AdECN at its Web site, but the idea is to provide an exchange like those in the equities market for buyers (advertisers) and sellers (publishers) of display ad space. The concept of an ad exchange is not new – Yahoo acquired Right Media which arguably has the largest such exchange and Google’s tentative acquisition of DoubleClick, for which they outbid Microsoft, also includes the DoubleClick Advertising Exchange.

I’m still of the opinion that display ads (which are typically banners, although they have morphed into more annoying forms) are a throwback to an earlier era of the Web, but they still seem to appeal to some major advertisers and certainly to Microsoft’s Web advertising crew. Therefore, Microsoft wasn’t keeping up with the big boys without an ad exchange and now they have one in AdECN. Financial terms were not disclosed, but since AdECN is a 30 person outfit, it isn’t expected to be a substantial financial hit.

Filed under Acquisitions, Advertising, Conferences, Coopetition, DoubleClick, FAM2007, General Business, Google, Microsoft, Yahoo

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