11/5/2022 0 Comments Take the writedown“ AOL has a small ad engine, and so does 24/7, but forĪd placement it’s really DoubleClick or bust,” said Mr. To Google’s DoubleClick ad placement engine left some even outside Microsoft feeling the sting. “It’s just a matter of when, not if.” Nonetheless, the end of possible competitor “There are a lot of people that think that Microsoft and App Nexus are going to link up,” Mr. It may be using some of its partnerships to learn moreĪbout the online ad business as a prelude to an actual purchase, he said. Microsoft still has some innovative ad technology products, said Darren Herman, chief digital media officer at the Media Kitchen, a digital advertising agency. Its biggest purchase, and one that is thought to be going well for Microsoft. In May 2011 Microsoft paid $8.1 billion for the communications company Skype, Partnerships, including with Yahoo, WPP and App Nexus, which does real-time ad placement. The company’s Bing search engine has grown, as has its revenue per search. The poor performance of aQuantive has not hurt other parts of Microsoft’s online ad business. McAndrews was recently elected to the board of The New York Times Company. “Then they woke up the next morning and realized what theyīrian McAndrews, the chief executive of aQuantive, was promoted to head Microsoft’s publisher and advertising group in August 2007, but left the company in December 2008. “Microsoft bought aQuantive in a reactionary move to Google buying DoubleClick, thinking that ad serving was its core strength,” he added. “It could have been another DoubleClick, but they would have had to know a business where publishers and advertisers meet, and then invest heavily,” said Todd Sawicki, chief revenue officer at Cheezburger,Ī publisher of several popular Web sites. The company did have ad inventory and an ad placement engine similar to DoubleClick’s at the time, Google used DoubleClick’s huge inventory of Web ads inside AdSense, Google’s self-serve ad placement technology for third-party Web sites.ĪQuantive was a well-respected online agency based in Seattle, but its focus was on design and client services. With DoubleClick, Google appeared to be using that personalization technology for the placement of banners and other display advertising. Once highly profitable by indiscriminately pasting digital ads across the borders of millions of Web pages, theīusiness has become under pressure as companies like Google got better at aiming for individual tastes with search advertising. Microsoft bought aQuantive one dayĪfter the WPP Group bought 24/7 Real Media, another digitalĪdvertising company, for $649 million, and a month after Yahoo agreed to pay $680 million for Right Media, an online ad exchange.Īll of the acquisitions were in one or another part of the display advertising business across the Web. The purchase of aQuantive may well have been driven by pressure Microsoft was feeling at the time, not only from the DoubleClick deal, but by similar acquisitions by other companies. That deal has been highly profitable for Google, analysts say. At the time, aQuantive was the biggest company MicrosoftĪ month before the aQuantive acquisition, Google, Microsoft’sīig rival in online advertising, purchased a similar firm, DoubleClick, for $3.1 billion. The deal for aQuantive was struck when technology and traditional advertising firms were desperately seeking footholds in the world of Internet display advertising. Microsoft does make money in online advertising, but has relied on a number of digital advertising partnerships. “The industry has evolved beyond where aQuantive was “It’s disappointing, but it is not a shock at this point,” said Brendan Barnicle, senior research analyst at Pacific Crest Securities. The charge will not affect the online services division’s operations or financial performance, Microsoft said. The company said it took the write-down because “expectations for future growth and profitability are lower than previous estimates” for the online services unit. The accounting charge, called a write-down of good will, was essentially a write-off of the value of aQuantive, a digital advertising company that Microsoft bought in 2007. Microsoft owned up on Monday to the collapse of itsīiggest push into digital advertising, announcing that it would take a $6.2 billion accounting charge in its online services division for a failed acquisition.
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