Microsoft Accelerates Rollout In Yahoo, AOL Display Deal


Data has become one of the most important pieces in the recently announced Microsoft, AOL and Yahoo display ad alliance. Microsoft ad executives have found that data-rich markets tend to have the greatest success for bidders and buyers tapping the exchange, according to Mary Ann Benack, director of scale enablement at Microsoft Advertising.

The alliance is intended to give Microsoft, AOL and Yahoo a fighting chance to compete against rival Google in the display ad space. eMarketer estimates that Microsoft's share of the overall U.S. display market would fall to 4.9% this year, down from 5.1% in 2010.

AOL's share will fall to 4.2% -- down from 4.8% -- and Yahoo's share would slide to 13.1%, down from 14.4%, respectively. Conversely, Google's share of display revenue will grow to 9.3% this year, eMarketer estimates, up from an 8.6% share in 2010. Facebook has also become a rival. By 2012, eMarketer expects Facebook will hold 19.5% of the display ad share market, up from 12.2% in 2010.



Perhaps that is one reason for the accelerated rollout  of the Microsoft Advertising Exchange. It will provide Microsoft, AOL and Yahoo with the ability to compete with Facebook too. "We only expected to roll out in six markets this calendar year," Benack said, but the Microsoft Advertising Exchange now supports buying and selling in 15 markets, from the Americas to Europe to Asia-Pacific.

The Microhoo relationship with Yahoo that began as a search alliance serving paid-search ads might seem as if it just added AOL to expand into support for "premium" display ad inventory. It didn't. The deals are separate. Benack said Microsoft continues to see "significant" percent growth in terms of what the exchange contributes to the company's total display ad revenue. The deal got underway in April and returns sequential double-digit growth.

In addition to the partnership with Yahoo and AOL on the display side, the Microsoft and Yahoo Search Alliance accelerated its roll out launching in several markets. On Sept. 14, the transition of Yahoo Search back-end technology over to the Bing platform began for Hong Kong, Taiwan, and many of the Pacific Rim countries. In August, the transition of Yahoo Search back-end technology over to the Bing platform began for the UK, Ireland, France, Spain, Germany, Switzerland, Italy, Greece, Turkey, Poland and Romania.

This means that Bing will soon power all of Yahoo's organic search results, on both PC and mobile, similar to in the United States, Australia and various South American countries. Also, this August, adCenter launched in India, with other markets to follow.

Technology makes it easier for ads to find their audience, and ad industry engineers have become more sophisticated in their use of data to make inventory more valuable.

Eric Dahlberg, director of the Microsoft Advertising Exchange in the United States, confirmed the company's position when it comes to working with more than 100 third-party companies buying display ad inventory to resell to agencies or advertisers through the exchange.ble.

Earlier this week, Yahoo said it now owns Interclick, announced in early November, and will begin to integrate the technology into its ad-serving platform supporting audience targeting and campaign reporting. No telling if the three-way alliance -- Microsoft, AOL and Yahoo -- will benefit from this deal or simply become a thorn in Microsoft's side.

Microsoft will continue to monitor the progress through the second half of the company's fiscal year -- the beginning of the calendar year -- to determine where to offer the services next.

Next story loading loading..