Mobile, Video Ad Sales Hit Hard by Microsoft Cuts
Microsoft’s latest round of layoffs, which were confirmed on Wednesday, are interesting in that the tech giant seems to be cutting back on online video and mobile advertising, which just happen to be two of the fastest-growing sectors in media today.
Sources tell Adweek that the moves signal a shift toward automated ad selling rather than using a human sales force to sell ads to brands. The trade pub also reports that between 15 and 30 percent of Microsoft Advertising’s sales force will be eliminated.
Wednesday’s layoff announcement wasn’t altogether surprising, given that earlier in the week the company took a massive $6.2 billion write-down tied to its 2007 purchase of aQuantive.
On the way out now are Microsoft’s entire mobile advertising team, with the exception of Jeff Plaisted, director of sales and strategy, mobile & Skype advertising, as well as much of the Global Creative Solutions team, which includes its Branded Entertainment Experiences Team (BEET), the report says. BEET director Russ Axelrod is said to be among those taking severance packages.
The sources said the remaining members of the Global Creative Solutions group would shift their focus on promoting Windows 8 to app developers, rather than on brand advertising.
Atlas, Microsoft’s ad server that was part of aQuantive, and several regional sales offices are among the other divisions also hit by the cuts.