For Microsoft, Automated Display Not An Automated Teller Machine

The money in technology is not real.

When you look at the sums involved in Facebook’s initial public offering, or at Monday’s news that Microsoft will write down almost the entire value of its 2007 acquisition of aQuantive–a $6.2 billion hit–what other conclusions can one draw?

And who aside from Steve Ballmer drops $6.3 billion in cash, and just five years later says it was all for naught?

aQuantive, which has since been folded into Microsoft Advertising, was the number two player in adtech, the business of automating the selling and serving of display advertisings. Google acquired the number one player, DoubleClick, also in 2007, and the California-based search giant has been dominant ever since.

“While the aQuantive acquisition continues to provide tools for Microsoft’s online advertising efforts, the acquisition did not accelerate growth to the degree anticipated,” Microsoft said in the careful words of a press release.

Microsoft isn’t just losing money here, the company is losing face. Microsoft paid a whopping sum for the number two player in adtech in 2007, then declared they would soon be the proprietors of the “industry leading, Internet-wide advertising platform.” Didn’t happen.

Some say, Microsoft didn’t act fast enough to implement aQuantive’s technology across its best assets like Bing. Whatever the case, display advertising, for all its promise, continues to present problems for companies not located in Mountain View, Calif.



About David Burn

I wrote my first ad for a political candidate when I was 17 years old. She won her race and I felt the seductive power of advertising for the first time. Today—after working for seven agencies in five states—I am head of brand strategy and creative at Bonehook in Portland, Oregon.