adCenter launched, Should Google be worried?

May 4th, 2006

Microsoft has officially launched their new adCenter advertising system, and US publishers can now sign up for the system (which, incidently, doesn’t work in Mozilla Firefox browser!). UK trial launch is expected in early July. What’s interesting from the zdnet article is that Microsoft seem to be repositioning themselves away from being a ’software’ company, and evidently see the future of their core business in online and media properties. They’re serious about it too - a recent leaked report states that Google is in part the reason for their $2.4 billion increase in spending for 2007.

So, what could convince advertisers to use Microsoft adCenter instead of the established Google AdWords? Well even without a content network of publisher sites, MS have a pretty impressive reach through it’s msn portal and hotmail/live.com mail system and it’s becoming apparant that Windows Live, Office Online and Office Live will be monetised at least in part by it’s new system. The real incentive for advertisers is Microsofts promise of exceptionally narrow targeting to consumers. With so many internet users having MSN accounts for Hotmail, Messenger and other MSN services, Microsoft can offer targeting as precise as showing for example pizza delivery company adverts to mothers of young children between 4 and 6pm. Whether they can deliver on this promise, and what this does in terms of ROI and price per click at certain times of day in certain markets.

Rumours also abound of Microsoft and Yahoo having informal meetings about a possible partnership. I’m not sure there’s any truth in this, but just as a concept.. I’d say that this sort of banding together of competitiors would concern Google far more than any single competitior they have right now, and for good reason!