Facebook Is In Talks With Microsoft To Buy Its Advertising Technology

Mergers and acquisitions happen all the time. A general idea about the acquisitions is that big corporations ingest small organizations with promising businesses to increase its technology base, intellectual property or just to start a new vertical without actually having to start one. But the new trend in the technology market has brought a scenario where a company with certain technological or business advantages goes on to acquire a part of another big firm, while both the firms’ other departments function normally.

A recent news is a case of both combined together. Facebook Inc. recently is in talks with Microsoft Corp. to acquire its advertisement technology. Facebook in itself is a giant ad hub but limited to its own circle on fb.com (yes, if you didn’t know, you can use that URL too). With this deal, Facebook can branch out to putting its advertisements on other websites, drastically expanding its operation base and finally posing a market threat to the undisputable Google (Facebook generates 86% of its revenue through ads on its own website).

Atlas Solutions that Microsoft acquired through its $6 billion acquisition of aQuantive in 2007 (again a merger), according to reports in the technology blogs Business Insider, is its ad serving agency. Though there has been no official word on this but the deal is being estimated to a whopping $30 million. Microsoft definitely has been having a hard time in the smartphone industry and the recently launched surface needs a breath of aggressive advertising to reach and convince its potential customers or it was going to fail. Microsoft realizing this, has prepared itself for the challenge.  It is estimated that the software giant is spending between $1.5 billion and $1.8 billion on television commercials and online and print advertisements with the launch of Windows 8.

The key factor in determining a good advertising agency and rationalizing about its capability is the quality of that ad hub to generate meaningful and focused campaigns to reach the customers in an organized way. With a platform like Facebook where consumers interact, advertising can prove (and is currently proving) to be a good business opportunity. With Microsoft’s technology, Facebook will open the Internet to its ad capability, which in turn will open customers to a more personalized and focused experience

Image Courtesy | paperblog

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