Microsoft to Continue with Direct Sales and AppNexus Partnership in Spanish-speaking LatAm
What: Microsoft Advertising will continue to sell its properties via direct sales efforts and its partnership with AppNexus in Spanish-speaking Latin America, a spokeswoman at Microsoft Advertising tells Portada. For the Brazilian market, as well as another 9 major markets, AOL, which was recently bought by Verizon, will take over sales efforts from Microsoft Advertising's Sales Team.
Why it matters: Spanish-speaking Latin America will be treated differently than many major markets, including Brazil, where Verizon-owned AOL will start managing and selling Microsoft's display advertising inventory across several platforms including MSN, Outlook.com and Skype following a 10-year search-and-advertising partnership. The deal includes all major markets, including the US (U.S. Hispanic), the UK, Canada, France, Germany, Spain, Japan, Italy and Brazil, which stand for more than 60% of Microsoft's ad revenue.
Thanks to a 10-year search-and-advertising partnership, AOL recently acquired by Verizon, will start managing and selling Microsoft's display advertising inventory across several platforms including MSN, Outlook.com and Skype.
Around 1,200 Microsoft employees will get offer letters from AOL, most of them in ad sales, under the deal. In addition, AOL will end its search distribution relationship with Google in order to accept Bing, Microsoft's web search engine unveiled in 2009, on all its mobile and desktop properties – giving Microsoft an additional 1-2% of search market share carved directly from Google's lunch. That part of the partnership kicks off in January 2016.
Following this deal, AOL will be responsible for all of Microsoft's entire media portfolio including display, mobile and video advertising on MSN, Windows, Outlook.com, Skype and Xbox and in nine markets including the US, the UK, Canada, France, Germany, Spain, Japan, Italy and Brazil, which stands for more than 60% of Microsoft's ad revenue.For the next ten largest markets, many of them in Western Europe, Microsoft says it will go "all in" on programmatic through its key ad tech partner, AppNexus. Nearly all media supply Microsoft controls in those countries will become traded programmatically, not merely the remnant portions.
Spanish-speaking Latin America
Sources at Microsoft’s headquarters for Latin America and the Caribbean in Ft. Lauderdale, tell Portada that for the Spanish-speaking Latin America targeted Sales Team "there will not be changes." "We will continue to offer our inventory through our sales team, with the same level of commitment and quality. We will also continue with our partnership with AppNexus for programmatic sales via Microsoft Advertising Exchange. AppNexus will continue to be our partner for programmatic sales on a worldwide basis.
We will continue to offer our inventory through our sales team.
Microsoft's deal-making process estimated AOL could receive between 20% and 30% of ad revenues generated by sales of Microsoft inventory.For AOL, which was recently purchased by Verizon in a US$4.4 billion deal ,the deal represents an opportunity to increase its digital advertising clout at a time when considerable power is accruing to Google and Facebook.
AppNexus, a major DSP, demand side platform, and Microsoft's key ad tech partner until now and a company in which it holds significant equity via a 2010 investment, will remain the technology platform in the top nine markets where AOL has taken the rein, as well as in Latin America including Brazil, which means its position is secured for the time being.
Even though AOL offers a sell-side platform of its own, it's unclear whether it has the technology chops to process the high volume of bid activity that Microsoft's inventory brings in. AppNexus and Microsoft issued a press release to announce a "multi-year" extension of their technology agreement, to avoid any misunderstanding. AppNexus traffics Microsoft inventory in 39 markets.
Microsoft also confirmed that it will no longer collect its own map data but will continue to offer Bing Maps.Microsoft will similarly sell some of its technology to the ride-sharing company and 100 workers will transition to Uber. No finances regarding the deal were disclosed.
Check out the Sept. 2014 Portada Interview with Frank Holland, Corporate VP Microsoft Advertising & Online (Spanish).