• by Laurie Petersen , June 15, 2007

Fresh off a deal to sell his agency to Microsoft Corp. for $6 billion, all eyes were focused yesterday on aQuantive president and CEO Brian McAndrews, the digital adman of the hour at the American Association of Advertising Agencies' first-ever Digital Conference in New York.

In a Q&A with Mike Donahue, executive vice president of the AAAAs and co-CEO of Ad-ID and ebiz for media, McAndrews said it became obvious that Microsoft would give aQuantive the chance to accelerate its vision with an infusion of financial capital and technical resources.

"The key difference between digital and traditional media is technology," he said. "We are aligning with the largest technology company in the world."

While predicting that consolidation in the industry will continue, McAndrews said that doesn't mean an end to the scrappy innovators.

"We're in the first or second inning of a long game here. There's no monopoly on innovation," he said. "I don't think you're going to see two or three big players and then game over. There will continue to be a broad range of companies."

Aligning with Microsoft will give aQuantive immediate access to resources it would otherwise have had to acquire independently--such as Massive, the in-game advertising experts, and ScreenTonic, the mobile marketing firm.

While Atlas and DrivePM are more technology-oriented parts of the business, Avenue A|Razorfish will remain the most independent and least affected unit when the deal closes later this year, McAndrews said.

One obvious advantage Microsoft brings is immediate global scale, McAndrews said. "We are in the seven largest countries. We want to be in more."

Meanwhile, McAndrews said, the agency's choice to be a best-of-breed pure-play digital agency is playing out in spades.

"We've put creatives and media planners side by side with software developers and the statisticians," McAndrews said. "They get along. It's hard, but it's more easily done with a best-of-breed model."

As for the blurring line between advertising agencies and technology companies, "it's been blurring for years," McAndrews said. "That is the agency of the future. When all media are digital, we're all digital agencies."

A former ABC television executive, McAndrews also said he sees TV becoming more like the Internet than the other way around.

"Distribution can trump destination," he said. "I need to go where the audience is."

Evolving formats and accountability are the other two inevitable trends.

The Microsoft deal felt like more of a fit, McAndrews said, in part because of the familiarity aQuantive had with many of the Microsoft team through previous business dealings and by being co-residents of Seattle.

In an interview after his official Q&A, McAndrews said aQuantive is continuing to look at acquisition opportunities--particularly in the international agency side.

As for the conflict of interest issue, with Microsoft both a buyer and seller, McAndrews said it's no different than aQuantive's existing experience operating Atlas and DrivePM along with Avenue A|Razorfish.

"We keep the businesses separate," he said.

McAndrews anticipates no antitrust hurdles for the deal because aQuantive is strong in areas where Microsoft is weak, and vice versa. "We don't have a search engine. Microsoft does. Atlas is a leader in video on demand. Microsoft has complementary IPTV. "

As for Google/DoubleClick, he said, it's a completely different story. "But it will be up to the government to decide."