AOL taking over Microsoft’s advertising business

Microsoft announced it has entered a 10-year partnership with AOL and AppNexus.

The deal will make AOL the seller of all display formats, including mobile and video ads, for the Microsoft portfolio in the United States, United Kingdom, Canada, France, Germany, Italy, Japan, Brazil and Spain.

In exchange, Microsoft Bing will power search and search advertising across all of AOL’s properties.

People familiar with the matter said that up to 1,200 people could be impacted by the deal. One source told Venture Beat that between 500 to 1,000 jobs will be cut.

Microsoft Vice President of Microsoft, Rik van der Kooi commented:

“We believe in the advertising model, and we care deeply about those services that are monetized through ads. But if you look at trends in the industry, it makes complete sense for us to line up with AOL.”

AppNexus is Microsoft’s lead technology partner for its programmatic business. Microsoft expanded its partnership with AppNexus partnership.

It is set to will become Microsoft’s exclusive programmatic technology and sales partner across 10 markets in Austria, Belgium, Denmark, Finland, Ireland, the Netherlands, Norway, Portugal, Sweden and Switzerland.

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In a statement Microsoft said:

“Today’s news is evidence of Microsoft’s increased focus on our strengths: in this case, search and search advertising and building great content and consumer services. The evolution in our approach to display advertising allows us to keep this focus, while working with industry leaders to market our services.

“We remain as committed today as we have been in the past decade to digital advertising and its effectiveness in delivering free services to consumers worldwide.”