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Microsoft Assures DSPs, Ad Nets They Are Welcome to Its Inventory

  |  December 16, 2011   |  Comments

A message for channel partners: Your money is good here.

Microsoft has a message for DSPs, ad networks, and other vendors that have lately felt the cold shoulder from Yahoo: Your money is good here.

The company said yesterday that it's been hearing from these third parties - "channel partners," in its parlance - some of whom are apparently worried about losing access to inventory on MSN, Windows Live, Xbox Live, and other sources. And it wants to reassure them it's not about to tie off the artery of demand they bring to its remnant ads.

"We want to put out there that we're definitely open to work with these third parties," said Eric Dahlberg, who heads up exchange sales and U.S. targeting at Microsoft. "We're excited to have the exchange as a platform where more and more of these partners tap into our inventory and power solutions."

Their concern was triggered by Yahoo's decision to require advertisers buying its "class two" display ad space on Right Media to obtain direct accounts. After January 11, marketers won't be able to rely on a DSP's single seat on the exchange to buy Yahoo Network Plus inventory. The policy change also affects retargeting firms such as Criteo that also function as new-fangled ad networks, and could spread to traditional ad networks as well according to rumors.

The only middlemen spared Yahoo's restriction are agency trading desks such as Publicis-owned Vivaki's Audience On Demand unit and WPP's Media Innovation Group. As Seth Dallaire, the guy in charge of Yahoo Network Plus, told ClickZ, "Agencies and the holding companies are critically important customers for us."

Agency trading desks are important to Microsoft too, says Dahlberg. But they're just one piece of a sales equation that also includes a large direct force, channel partners like DSPs and ad nets, resellers to small and mid-sized businesses (a small but growing category), and other firms that specialize in a niche - such as a vertical, technology, or data source.

A large majority of Microsoft's display ad revenue comes through direct, custom sales - and Dahlberg says that's not going to change soon.

Among the programmatic buyers, he says there's no dominant source of demand. "We see very distributed investment in our exchange. Spend on the exchange isn't concentrated in any one of the groups," he said.

So why would Microsoft Exchange impose restrictions on who can and can't buy on its exchange? It wants to encourage demand to flow from every corner of the Lumascape.

"We're super interested in working with third parties," said Dahlberg. "Even though we're investing as well, we see some unique data sets Microsoft doesn't have and some unique technology. Microsoft can't hope to develop every technology itself."



Zachary Rodgers

Until March 2012, Zach Rodgers was managing editor of ClickZ's award-winning coverage of news and trends in digital marketing. He reported on the rise of web companies, data markets, ad technologies, and government Internet policy, among other subjects. 

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