RealTime IT News

Microsoft Display Ads Take Their Test

UPDATED: Microsoft today began testing display advertisements in Microsoft Office Live, Windows Live Mail and MSN Spaces, a move that might give the company some footing in its competition with Google.

The Redmond, Wash.-based company said the ad testing will help generate revenue to provide consumers with a wide array of free and low-cost online services, such as Web-hosting, e-mail and Web services.

Windows Live, which is a collection of personal Internet services and software such as e-mail and news, will display ads in MSN Spaces in Australia and Italy. The company will test Windows Live Mail display ads in Australia, Brazil, Canada, China, France, Germany, Italy, Spain, the United Kingdom and the United States.

Like Google's popular Gmail, Windows Live Mail is a free e-mail application based on asynchronous JavaScript and XML (AJAX). While Gmail and Windows Live Mail are free to users, advertisers still must pay and therefore may soon have to choose between the two.

Office Live display ads, which are being tested in the U.S., immediately sold out of their available openings for beta advertisers, Microsoft spokesperson Karen Redetzki told internetnews.com.

"It was like getting tickets for a rock concert."

Coca-Cola Brazil, JCPenney and Monster Worldwide nabbed some of the space.

Office Live is a collection of online services designed as an alternative to an in-house IT staff for small businesses with 10 or fewer employees.

It comes in three versions, including two subscription services, Microsoft Office Live Essentials and Microsoft Office Live Collaboration. But it's Microsoft Office Live Basics, the free, ad-supported package, that most seems like a Microsoft counterpunch to Google's offerings.

The experimental shift toward advertising revenue may seem a subtle one for Microsoft, but the move is felt as a tremor across the IT landscape, because it puts the company into direct competition with search giant Google.

Redetzki acknowledges that her company is finally putting itself in the ring with Google.

"We know we've got strong competition, including Google," she said. "But we also know there are things to differentiate us. With the audience we already have, with the audience we can attract, we believe we can deliver the largest advertising audience and the best product."