CNBC has picked Microsoft to be the exclusive provider of display and contextual advertising in the U.S. for the CNBC.com Web site…
“Microsoft Corp., competing with Google Inc. for online advertising sales, struck an exclusive agreement with business news channel CNBC to provide ads for its Web site…”
Seattle — Microsoft Corp. and CNBC on Monday announced a strategic alliance in which the two companies will collaborate to bring relevant advertising to more than 2.6 million unique monthly visitors to CNBC.com.
“CNBC audience provides increasingly strategic opportunities for advertisers.”
The software giant — which is attempting to challenge Google’s Web ad dominance — will be the exclusive third-party provider of display and contextual advertising for CNBC’s financial site, MSN Money and its global audience. Microsoft said it plans to aggregate information about CNBC.com visitors’ Web surfing habits to better target advertising in the future.
The companies are not disclosing the terms of the multiyear agreement, said Jon Tinter, general manager of online strategy at Redmond, Washington-based Microsoft.
In a deal similar to ones already in place with Facebook and Digg, Microsoft will become exclusive provider of banner and contextual ads for the CNBC site.
The agreement takes effect immediately, with Microsoft delivering contextual ads, which are based on what the user is viewing, for CNBC.com later this month. “Display ads will start in March.”
“CNBC.com has a tremendous, high-quality audience that advertisers are eager to reach, and we are delighted to be providing our advertising technology and sales resources to such a widely respected organization,” said Steve Berkowitz, senior vice president of the Online Services Group at Microsoft. “The addition of CNBC to our syndicated advertising partner sites will help the advertisers that work with Microsoft reach an even broader set of users in this highly strategic audience segment.”
Google, owner of the world’s most popular Internet search engine, gets about seven times as much Internet ad revenue as Microsoft. Microsoft has fought back by winning deals with clients such as General Electric Co.’s CNBC and Facebook Inc., the second-most popular social-networking site.
“We see very high demand, so we are always looking for more inventories that we can sell those advertisers,” said Tinter. Microsoft plans to package ad sales from its MSNMoney site with sales for CNBC.com, which focuses on providing real-time financial news and stock market information, he said.
“Inventory from the two sites (CNBC and Microsoft) will get aggregated together into a larger network for advertisers,” said Tinter.
Contextual advertising delivered by Microsoft is expected to begin appearing later this month on the CNBC.com site, while display advertising will begin in March 2008.
Though CNBC’s parent company NBC Universal has a relationship with Doubleclick that will continue, CNBC, which had been selling all of the banner and contextual ads on its site, will now turn the bulk of that business over to Microsoft, said Elizabeth Sami, senior vice president of business development at CNBC.com. The company has not decided if it will use a third-party advertising partner for the international portions of CNBC.com, which are being sold by in-house staff, she said.
Google announced its intent to purchase “Doubleclick” in April, but the deal has not closed pending regulatory approval. It is currently under scrutiny by federal regulators and lawmakers.
Microsoft’s strength in selling advertising on its MSNMoney site was part of the draw of teaming with the company over other providers of online advertising, Sami said. She added that the company believes that Microsoft has the best technology to provide this kind of advertising.
“Advanced technology from Microsoft will help connect advertisers with CNBC.com users in more relevant, innovative ways through a combination of graphical ad placements and automated text-based advertisements targeted to content. Over time, the technology will enable the anonymous aggregation of user behavior.”
“CNBC and Microsoft share a commitment to providing global customized advertising solutions to all our customers, and we are confident that this alliance will help us deliver on that commitment for the long term,” said Mark Hoffman, president of CNBC. “CNBC’s world-class customer service team and global sales force combined with Microsoft’s innovative advertising and sales teams will provide the most relevant and useful advertising to our highly educated and affluent visitors.”
The deal with CNBC.com and others are some evidence that Microsoft’s $6 billion purchase of digital services agency aQuantive in May, may be starting to pay off. Tinter said it will be a combination of Microsoft’s adCenter platform and technology from that acquisition that will be driving ad sales on the CNBC.com site.
In the last two years Microsoft has added services and content for its online brands Windows Live and MSN to boost the revenue of its Online Services Business segment, particularly from online advertising. So far, however, financial analysts have said they are unimpressed by the growth of the group despite this investment. Revenue from online services grew only 8.7 percent from 2.3 million to 2.5 million for Microsoft’s fiscal year 2007, which ended June 30.
The company wants to boost its share of the Internet ad market to 40 per cent from six per cent, Kevin Johnson, president of its platforms and services division, said in a speech last month.
Securing advertising syndication deals allows Microsoft to offer advertisers a wider pool of Internet sites for ad delivery. It is part of Microsoft’s push to gain ground on Google Inc. and Yahoo Inc. in the $40 billion market for Web advertising.
“CNBC is a unit of media and industrial conglomerate General Electric Co.”