Microsoft (NASDAQ: MSFT) is losing the online ad battle to Google (NASDAQ: GOOG) so why not get into the TV advertising business?
According to The Wall Street Journal, Redmond will buy "Navic Systems Inc., an eight-year-old company that helps advertisers place ads on television programs."
Whatever Microsoft paid is too much. Small M&A deals are not going to do anything to help the world's largest software company, especially if they are in slow growing part of the advertising market like TV. Navic may be good at targeting messages to consumers using demographic data and user information from set-top boxes, but over time, TV will have a smaller and smaller piece of the total marketing pie.
Microsoft appears to have lost its battle to buy Yahoo! (NASDAQ: YHOO), but the online ad business is still the only part of the industry that is still growing in double digits. The company needs to put its acquisition money there and stop fooling around with old media.
Douglas A. McIntyre is an editor at 247wallst.com.
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Reader Comments (Page 1 of 1)
6-18-2008 @ 11:00AM
Jeff said...
Television advertising revenues have been increasing, recently accounting for $46.3 billion in the US, expected to grow to $148 billion by 2012 globally.
I fail to see your point that Microsoft's entry into the larger, more lucrative, and relativley technologicaly absent field of television advertising is a bad move. The money isn't in the me-too's.
6-19-2008 @ 4:55PM
web design company said...
That's a very weird way of doing business. "Since we can't make money online, let's make money on TV!" This could hurt Microsoft or it could help. I wonder...