Microsoft in favor of ad targeting legislation?

I know I’m late to the game with my take on today’s major story, but maybe there is a fresh angle. Hint: It’s the not the NCAA tourney if you are reading this post.

http://www.nytimes.com/2008/03/20/business/media/20adco.html?_r=2&ref=technology&oref=slogin&oref=slogin

It’s obviously the story that made the NY Times today about legislation surrounding ad targeting. This impacts virtually every company advertising or publishing online in some way.

Let’s repeat that, this impacts virtually every company online in some way.

Here’s some examples:

– The big dogs: MSFT, GOOG, AOL, etc.

Why: Every possible reason. Overall network CPM prices, user registration lift to ad targeting, production resources (engineers, marketers, etc) making products around some of these programs. In fact, to be more pointed here, there are whole multimillion dollar R&D divisions asking the question: how do I improve targeting *who are not making a dime yet at these companies

– The current flavors: ActiveResponsys, Revenue Science, Blue Lithium

– Why? The strength of their business models is based upon this type of targeting. Revenue Science is probably the biggest impacted because they are the last partner left at a ball (does anyone know when Rev Sci will get acquired?)

– The “metric based mega publishers”: eHarmony, Classmates.com, Tickle.

MBMP: These are companies that are regarded as being customer acquisition focused but do such high volumes that they have turned their sites into publishing plays by sticking up display ads.

Why? – See answer for the next group

– Mid – to Long – Tail Networks: Active Athlete, Martha Stewart Living, etc.

Why? These are all publishers who are attempting to extend inventory through exchanges or cookied-based ad purchases. For example, these networks identify you as being “inmarket” for sports on one site, and then purchase you in a social network or other at a cheaper cost at the same high-cost branded cpms.

I was going to stop here, but I forgot the mother of them all:

– The……..well….just……FACEBOOK.

– Why? Ever hear of project beacon and new marketing paradigms.

(fly on the wall…..fly on the wall)

Perhaps the most interesting thing about this story is Microsoft being in favor of legislation.

At first it doesn’t add up. aQuantitive and DrivePM, recent Microsoft acquisitions, are highly indebted to ad targeting of this nature. The purchase of YaData recently. The deal with Facebook.

And to be honest it still doesn’t add up, so there is only one conclusion why this may be the case, at least that I can come up with:

– Microsoft feels there is some way to level the playing feel with Google based upon this. The only thing I can think of is that Big Redmond feels that the toolbar, gmail, and search origination have created a large lead. As well, if they slow the pace of Google’s ability to make software free based upon ad views, they defend their core products.

I would love to hear other opinions on this. And that’s what it will really come down to, are consumers willing to trade data for the rights to free content.

Maybe that’s another post, but I think the answer is yes.

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1 comment so far

  1. A Nonymous on

    MSFT is in favor of throwing barriers in front of online ad tracking by cookies, since it owns an 80% share of installed operating systems. As part of the terms and conditions of installing the OS, they can say you agree to let us track you through the registry. Or make it a bargained for exchange, $100 cheaper to buy the OS with tracking vs the OS without tracking.

    One area not discussed in the media is how offline direct marketers will be affected by such legislation. Even the federal government may have to change its practices, since it now outsources “change of address” processing to firms that sell this information to offline marketers.


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