Thursday, May 04, 2006

Microsoft adCenter launched - Ballmer says Microsoft evolving from software to media company

At the upcoming MSN Strategic Account Summit, Microsoft CEO Steve Ballmer will announce the launch of Microsoft adCenter. Previously known as MSN adCenter, the product has been in pilot since mid-October. adCenter is obviously Microsoft's big play for a piece of Google's huge Adsense pie, but perhaps equally as interesting is that it represents Microsoft's evolution from a software company into a full-fledged media company. At least that's how I read the following extract from the press release:

'"Ad-supported software services are an integral part of Microsoft's plans to give consumers access to a broader variety of digital media, whenever they want and on whatever device they prefer," said Ballmer. "Our close partnership with the ad community is extremely important to us as we evolve Microsoft from a software company into the world's largest, most attractive provider of online media through MSN, Windows Live(TM) and adCenter."'
(emphasis mine)

Now correct me if I'm wrong, but that's the first time I've ever seen an official statement from Microsoft that says they're moving away from being a software company! Microsoft has always been — and I thought always will be — first and foremost a software company. Sure, they're adapting to the 'web 2.0' era with their "software as a service" strategy. And sure they're heavily into media devices with things like X-Box and Media Center. But beneath it all, Microsoft is a software company. Isn't it? Bzzzzt. Wrong, apparently. Steve Ballmer now says that Microsoft is evolving from a software company… into a media company.

Perhaps it's just a bit of sloppy work by Microsoft's PR people, to quote their CEO as saying they'll no longer be a software company. If so it's indicative of the general branding chaos that has been evident at Microsoft in recent times. From the MSN vs Live confusion, to the just announced re-naming of adCenter from MSN adCenter to Microsoft adCenter. At the very least it looks like MSN as a brand name is being, rather clumsily, ushered out the door.

In any case, Microsoft adCenter is definitely taking aim at Google's market:

"As the advertising engine for Windows Live, MSN and other Microsoft online services, Microsoft adCenter is helping advertisers strategically plan their online buys and is designed to help them gain a higher return on investment by utilizing real audience intelligence and advanced targeting capabilities."

As for what Microsoft products will likely be first in line for adCenter, Search Engine Watch thinks it'll be: Windows Live Mail, Windows Live Spaces, Windows Live Safety Center, Windows Live for Mobile, Office Live and Office Online, and the Xbox Web site This probably explains the brand change from MSN to Microsoft adCenter - because most of the above products are 'Live' ones.

You know things are getting very interesting in the Internet world when the world's most successful software company puts so much attention and money into becoming a media powerhouse. Frankly I don't think Microsoft needs Yahoo, they have enough resources and media products on their own to take on Google.