Microsoft Establishes adLab as R&D Center

Microsoft has set up a research center in Beijing in an effort to prepare the company to innovate in digital advertising.

The adCenter Incubation Lab, or adLab, is a joint project of Microsoft adCenter — the company’s ad management and placement software — and Microsoft Research. It involves about 22 scientists in Beijing and 20 more at the software company’s headquarters in Redmond, Wash., according to spokesperson Karen Redetzki.

Ying Li of Microsoft adCenter will lead the Redmond team and Jian Wang will lead the Beijing-based group. The scientists working on adLab specialize in fields like data mining, information retrieval, statistical analysis, artificial intelligence, auction theory, visual computing and digital media.

The adLab is aimed at incubating advanced targeting and reporting capabilities for adCenter, as well as envisioning how the solution would work in the digital media landscape of the future. The researchers are mostly working on features and capabilities that might appear in adCenter in the years — not weeks or months — ahead.

“The Microsoft team of top researchers in this field is unsurpassed and certain to produce compelling advances that will impact and ultimately change the game in online advertising,” said Tarek Najm, general manager of adCenter, in a statement.

The adLab launch comes at a time when Microsoft is playing catch-up to more established players — including Google and Yahoo — in the online advertising arena. Yet the company has made clear it intends to make advertising a significant revenue stream in the future, and adLab appears to be part of that overall plan.

The company officially took the wraps off adLab at an event in Redmond in which the Beijing-based scientists presented prototypes of a number of their projects. The prototypes involved mobile and television-based ad products, as well as online ad solutions that involved video.

One more near-term prototype, which Redetzki said was coming in six months, was a capability to let marketers target ads by behavioral segments. She added that advertisers would also be able to create custom segments, which would let them more accurately target their prospects.

Scientists also showed off video hyperlink ads, which lets consumers zoom into products featured on a television screen and click-through to detailed information about the product. Translation software, ad bar-code readers and social network mining technologies were also displayed.

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