San Francisco — Software behemoth Microsoft Corp. Thursday confirmed that it has tapped former senior Yahoo Inc. executive Qi Lu, to head its struggling Online Services Group and boost its Internet search and advertising businesses, but in the process, it has lost Brian McAndrews, one of its own top advertising executives.
The software giant, who has tirelessly tried and failed to acquire Yahoo earlier this year, is looking to revamp its search-ad strategy to better compete with the industry juggernaut, Google Inc.
While announcing the appointment of Lu as the president of Microsoft’s online services group, Microsoft said that Brian McAndrews, former CEO of aQuantive, would be leaving Microsoft. McAndrews was considered as the top internal candidate for the post, which came open when Kevin Johnson left to become CEO of Juniper Networks.
News that Microsoft would appoint Yahoo prodigy Qi Lu to spearhead its online business surfaced on the All Things Digital blog Thursday morning.
In his new role at Microsoft, Lu will be responsible for managing a sprawling universe of technologies and media platforms, which includes aQuantive-owned Atlas, DRIVEpm, MSN Direct Response. He will also control the Online Audience business, which includes MSN and Microsoft Live Search, and will report to CEO Steve Ballmer. In addition, his fiefdom includes OSG Research and Development, and OSG Finance.
While announcing the departure of McAndrews’, Microsoft observed that the Advertiser and Publisher Solutions Group SVP had led the integration of aQuantive, which it said is “now complete.” Many in the digital ad space have praised the handling of that acquisition.
Ballmer praised the departing executive in the statement.
“Brian McAndrews built a world-class business for advertisers and publishers and led the successful integration of aQuantive into Microsoft, setting the foundation for our next phase of growth,” Ballmer said. “While I am sorry to see Brian leave the company, I respect and understand his decision and wish him nothing but the best in the future.”
Scott Howe will assume responsibility as corporate vice president of that group, Microsoft said Thursday.
Microsoft acquired aQuantive in May 2007 at a cost of US$6 billion, the largest acquisition the company has made to date. Microsoft said McAndrews “has decided to transition out of Microsoft, and will do so over the next several months, serving in a consultative capacity to Steve Ballmer and Qi Lu during that time.”
Altogether, Lu will handle some of the most important areas of development for Microsoft as it battles head-to-head with Google and other Web giants to command eyeballs and ad dollars on the Web.
Lu dedicated a decade with the revolutionary California firm, most recently serving as vice president of engineering for Yahoo Search and Advertising Technology Group before leaving in August, according to Microsoft.
“I am tremendously excited to welcome Qi to Microsoft,” Ballmer said.
Lu will commence work January 5 and report directly to CEO Steve Ballmer, who praised the new protégé’s “deep technical expertise, leadership capabilities and hard-working mentality.”
“I am genuinely excited about the opportunities ahead for Microsoft to make an enormous impact on the online industry,” Lu said in a statement. “Microsoft has built a great foundation for its search and advertising technologies and put an amazing team of researchers and engineers in place to drive the next wave of innovation in online services.”
“I am looking forward to working with them to help transform the way people and businesses use the Internet to find and share information.”
Satya Nadella, who has been leading Microsoft’s search business and senior VP Yusuf Mehdi along with two new vice presidents–divisional finance head Rik van der Kooi and Scott Howe–who will head advertiser and publisher efforts in the wake of McAndrews’ departure, will be reporting to Lu.
Earlier, Yahoo search executive Sean Suchter has been tapped by Microsoft to manage its Silicon Valley Search Technology Center and begins work for the Redmond, Washington, company later this month.
Before joining Yahoo in 1998, Lu has worked as a researcher at IBM Almaden Research Center, and went on to hold a variety of engineering roles. Before being named EVP of Engineering, he led development of Yahoo’s search, e-commerce, and local business listings.
He is a former faculty member of Fudan University in China, where he earned a master’s degree in computer science before going on to get a doctorate in the field from Carnegie Mellon University.
Shares of Redmond, Washington-based Microsoft closed at $19.11, down 76 cents or 3.8 percent, while shares of Sunnyvale, California-based Yahoo closed down 45 cents or 3.9 percent at $11.05.