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Microsoft to exit display and video ad biz after AOL deal

MUMBAI: Microsoft is exiting the display, mobile and video advertising business as it strikes a deal with AOL that will now manage and sell such kind of inventory across several platforms including MSN, Outlook.com and Skype.

AOL will take over the business in the US and eight other key markets including US, UK, Canada, Brazil, France, Germany, Italy, Spain and Japan. The expanded partnership includes a new 10-year search agreement.

Microsoft will also unload its display advertising in 10 additional markets, including Belgium and Austria, to New York-based advertising specialist AppNexus.

AOL president Bob Lord said, “This collaboration further validates our leadership position in digital advertising and the shift to automation, while also allowing Microsoft to focus on what they do best: industry-leading services and search innovation.”

AOL was recently purchased by Verizon in a $4.4 billion deal announced last week. Financial details of the deal were not disclosed, but it was revealed that AOL will make job offers to 1,200 Microsoft employees who currently handle everything from sales to engineering for the company’s display ad unit.

AOL will transition to a Bing-powered search solution beginning next year, replacing Google, state reports. Bing is Microsoft’s web search engine, unveiled in 2009.

Microsoft corporate VP Rik van der Kooi said, “This deal is further evidence of the quality of Bing results and the performance of the Bing Ads marketplace. And we will continue our focus on delivering world-class consumer services and content and look forward to partnering with AOL to market them.”

In a statement to Re/code, Microsoft stated, “Over the past year, we have taken many actions to focus the company’s efforts around our core business strategy. In keeping with these efforts, we will no longer collect mapping imagery ourselves and instead will continue to partner with premium content and imagery providers for underlying data while concentrating our resources on the core user experience. With this decision, we will transfer many of our imagery acquisition operations to Uber.”