Phil Sim

Web, media, PR and… footy

Microsoft must subsidise ad results

As someone who has managed to do alright as a bit of a tech media observer and critic I can only say to the Bloomberg reporter who wrote this lead par,

Microsoft Corp.'s new Web advertising software, three years in the making, may fail to crack Google Inc.'s dominance of the Internet ad market.

DUH! Ya reckon? Three smacks around the head with a wet fish for this bloke.

There's more buzz around to, regarding a Microsoft and Yahoo tie-up. This has been going on for some time ever since a Microsoftie supposedly mentioned in a blog or was quoted in a blog as saying that Microsoft might be willing to partner to upset the Google applecart.

Search Engine Journal reckons a Microsoft/Yahoo hookup is a good idea, not least for the fact that this game is "all about volume".

Time for another bit of advice from Squash & Co. Outrageously Priced Consulting. Microsoft needs to take a leaf out of the telecommunications industry's book of gameplays. Turn to page 34, which is titled Subsidies. Telco companies have no dramas giving massive subsidies on mobile phones or selling services below cost price in order to build market share. 

Microsoft needs to take the same approach to this market. It needs to go out and start subsidising online advertising in order to win over both advertisers and content providers. Guarantee big advertisers 50 per cent the number of click throughs they will get from advertisers. Guarantee content providers that they'll get a cheque no smaller than their last Google cheque if they switch ad networks. Even better just give away $100 worth of online advertising to new advertisers to try and grow the market.

This market is all about critical mass. But this market even more so is all about dollars and cents. All you have to do is give a better bottom-line result than Google and people will swap in droves. So spend a year hocking in big dollars to subsidise the results achieved by both advertisers and content providers and you'll be back in the game. Along the way, you'll have delivered Google a massive blow and suddenly Golden Boy won't be looking so hot anymore as it reels from consecutive disastrous quarters because Microsoft has hit it just where it hurts. 

Sure it will cost billions but this is the game of the future and as far as I'm concerned there ain't no other way to get dealt in. 

Filed under: Uncategorized

2 Responses

  1. MICROSOFT understands a little about the subsidies game too Phil. Wanna know how much they’ve lost on XBOX in the last 6 years?

  2. Joel says:

    I would love to see Microsoft and Yahoo make some waves:)

    – Even better just give away $100 worth of online advertising to new advertisers to try and grow the market. –

    I’m with ya 100% there:)

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