• by Shankar Gupta , January 18, 2007

Microsoft Wednesday previewed a new adCenter feature that will allow search engine marketers access to MSN data that can be used to predict demographic behavior, traffic, and how keywords will perform.

Microsoft will offer the feature, the Keyword Services Program, through a set of APIs, which are slated for release soon, the company said Wednesday during a conference call with reporters. Other new ad functions previewed Wednesday include a tool that predicts whether a search term is commercial or informational, and another that predicts the size of the demographic of a given keyword.

While adCenter's upcoming features potentially give the service a competitive advantage over Google and Yahoo, MSN also faces serious roadblocks, including relatively low traffic, downtimes and problems with customer service, said Greg Sterling, principal of Sterling Marketing Intelligence. "They're fundamentally challenged as their search share goes down, because it diminishes the inventory they have to sell," he said. "The features that adCenter launched with were next-gen features, but you have to get the fundamentals right, and I think they're still working through some of that stuff."

Earlier this week, comScore reported that MSN garnered just 10.5% of search traffic, compared to Google's 47.3% and Yahoo's 28.5%.

In addition to the search marketing tools, Microsoft also previewed video hyperlink technology, which will allow marketers to create ad links on products shown in videos. The company said it will make that technology available on MSN starting in the spring.

James Colborn, a product manager with Microsoft, also said the company is testing an ad network, similar to Google's AdSense, that allows search marketers to place pay-per-click ads on Web pages with relevant content. "One of the things we did want to do is offer people a content network which in principle is similar to what Google and Yahoo offer," he said. "At the moment, the content ads are in beta with a number of customers."

For now, Microsoft is testing the feature on Microsoft's network of sites, but the company plans to extend it to other publishers, Colborn said.