Microsoft retreats from display ads, handing operations to AOL & AppNexus
Microsoft is reportedly on the cusp of ordering a full retreat from its display ad business in a plan which will see such operations handed over to AOL and AppNexus.
The ten-year deal means AOL will now handle display, mobile and video ad sales for all Microsoft properties such as MSN and Outlook in its top nine markets including the US, UK, France and Germany. In 10 markets where AOL will not be managing Microsoft’s display business, AppNexus will take charge via a deal to become Microsoft’s exclusive programmatic partner.
The reorganisation will affect as many as 1,200 jobs although many of these will be offered the chance to relocate, either within Microsoft itself or with AOL or AppNexus, according to reports.
Microsoft’s search engine Bing will also power results and search advertising on AOL websites. The agreement could elevate Bing at a time when Google is being phased out as the default search engine on AOL’s portals.
The shakeup also impacts Microsoft’s maps business, which has been partly sold off to Uber. Financial terms of the deal were not disclosed and it means Uber now controls part of Microsoft that gathered visual images of streets and buildings for the Bing Maps service.
Microsoft is keen to divest itself of non-core interests as part of a business strategy devised by CEO Satya Nadella which will see it focus on personal computing, cloud platforms and business productivity.