Microsoft's Rapt Acquisition Enhances Ad Offerings

  |  March 14, 2008   |  Comments

Site side yield optimization firm will be added to Atlas Publisher Suite.

Microsoft took another stride in its race against Google today with the acquisition of Rapt, a company that helps Web publishers manage their advertising.

Rapt produces software that creates a database of a publisher's ad inventory, whether they are self-sold or collected from ad serving networks. Publishers can also use it to track and forecast ad performance. Rapt will be added to Microsoft's Atlas Publisher Suite.

Financial details of the acquisition, including purchase price, were not disclosed. Microsoft expects the deal to be completed within the month.

By acquiring Rapt, Microsoft continues its efforts to compete with Google to provide Web publishers with a full suite of ad serving technologies. Rapt's services are comparable to those of DoubleClick's Dart for Publishers and Google's Ad Manager, a beta version of which the search giant unveiled yesterday.

Google completed its $3.1 billion acquisition of DoubleClick earlier this week, a highly touted deal that gave Google a significant boost in the race for publishers.

Scott Howe, general manager of Microsoft's advertiser and publisher solutions group, said the acquisition was a response to feedback from clients.

"We're continually asking them what they need, and they say they want to be able to focus on their core competencies, to create great user experiences and fantastic content," he said. "They don't want to have to focus on building sub-scale operations, on ad packaging, data collection, inventory management or forecasting. Our view is that publishers shouldn't have to do that themselves."

Rapt, which boasts about 85 employees, is led by CEO and founder Tom Chavez, who will become part of Microsoft. The company plans to remain in California.

For Microsoft, the acquisition was about gaining Rapt's employees as much as its technology, said Howe. Indeed, he said it was Rapt's work force that would provide the true point of differentiation between Google's automated ad services and Microsoft's.

Rapt has "an army of consultants, PhDs who used to work at McKinsey or Boston Consulting Groups," he said. "These are people we can parachute into publishers to help them. It's not enough to give clients the rocket ship -- you've got to teach them how to fly it."

Microsoft, which is a publisher as well as a provider, was a client of Rapt before the acquisition. Howe said Rapt helped his company increase its ad revenue 10 to 15 percent, a number he says it should be able to duplicate for clients across the board.

Other Rapt clients include CNET Networks, Dow Jones and Company, Expedia and Fox Interactive Media.

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ABOUT THE AUTHOR

Douglas Quenqua is a journalist based in Brooklyn, NY who writes about culture and technology. His work has appeared in The New York Times, Wired, The New York Observer, and Fortune.

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