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Microsoft sheds advert business
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AOL, meanwhile, is adopting Microsoft’s Bing search engine, replacing Google as the default option for visitors who want to search the Internet on AOL websites. That means Microsoft will get a share of revenue from advertising that’s tied directly to Internet searches performed on AOL.
But Microsoft, which is based in Redmond, Washington, will let AOL take over the selling of other types of advertising on Microsoft websites and apps, including MSN, Skype and Xbox. An AOL Inc spokeswoman said the New York-based online media company will extend job offers to all 1,200 people who worked in Microsoft’s advertising business.
Microsoft Corp CEO Satya Nadella has been saying he wants to focus more on the company’s core software business and related services, while warning employees of the need to “make some tough choices in areas where things are not working.” Microsoft representatives indicated on Monday that both the AOL and Uber deals are an outgrowth of that strategy.
Under its agreement with AOL, Microsoft is unloading a business that’s declined in importance over recent years. Microsoft has steadily increased its sale of advertising related to searches on Bing. But revenue from other kinds of advertising, known as display ads, had fallen to about US$250 million in the last quarter, or about 15 percent of all ad revenue.
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