Microsoft sheds some of its ad business, mapping service

30 Jun 2015 | Author: | No comments yet »

Microsoft Hands Display Ads to AOL, Maps to Uber.

Microsoft Corp (MSFT) said on Monday it will hand over its display advertising business to AOL Inc and AppNexus Inc, and sell some map-generating technology to ride-hailing app company Uber, as it slims down its money-losing online operations. The moves mean Microsoft will focus on its growing search advertising business based on its Bing search engine, and displaying maps on its Windows devices rather than generating the maps themselves. Following the news that it will shed around 100 employees to Uber in a mapping technology deal, Microsoft announced this afternoon that it will now power AOL’s search property, and will apportion parts of its advertising work into both AOL and AppNexus.

AOL, which owns TechCrunch, was recently purchased by Verizon, so it seems that Microsoft and our New Corporate Death Star are now in business together. Microsoft no longer breaks out results for its online operations, chiefly its MSN web portal and Bing, but they have lost more than $10 billion over the past five years. The move comes with a host of layoffs — reportedly around 1,200 — some positions of which will be subsumed into AOL all of which will be offered jobs at AOL. Chief Executive Satya Nadella has said Bing will turn a profit next fiscal year. “Today’s news is evidence of Microsoft’s increased focus on our strengths: in this case, search and search advertising and building great content and consumer services,” said Microsoft in a statement.

It’s worth keeping in mind that Microsoft recently underwent a sharp series of layoffs following its purchase of the majority of Nokia’s hardware assets. Under a 10-year deal struck with AOL, now a unit of Verizon Communications Inc (VZ), AOL will sell display ads on MSN, Outlook.com, Xbox, Skype and in some apps in major countries. Microsoft did not disclose financial terms of its deal with Uber, saying only that it would no longer collect mapping imagery itself, but continue to work with imagery providers for underlying data on its own maps. Microsoft also announced an expansion of their partnership with the online advertising company AppNexus that would make the company Bing’s exclusive programmatic technology and sales partner in ten of its European markets.

Microsoft already gets much of its map data from Finland’s Nokia . “We will transfer many of our imagery acquisition operations to Uber,” said a Microsoft representative, without giving details. It noted in a blog post that it’s seen more than 50 percent of business in its Nordic countries turn programmatic, something that’s allowing it to take this larger step forward today.

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