Microsoft Maps The Future of Advertising

By Ed Sutherland

Microsoft researchers are working in China and India to
polish technology used by the software giant in order to compete with rivals.

Today Microsoft unveiled its MSN adCenter Incubation Lab (adLab) in Beijing,
China, where researchers put more than a dozen prototype digital-advertising technologies on display.

While some projects are in the early stages, such as delivering more information about televised products to consumers that click on a video hyperlink, others are trying to determine the best type of
advertising based on a person’s Web browsing habits.

Concepts involving contextual advertising and predicting user behavior, as well as how to exploit the growth of Weblogs, were sprinkled
throughout the list of projects.

Staffed by 50 researchers, the adLab is jointly run by MSN’s adCenter
and Microsoft Research. AdCenter’s Ying Li and Microsoft Research’s Jian
Wang, both of Asia, will lead the effort.

Other projects on display during the Demo Fest include advertising
bar-code readers, data mining and video ads.

The adCenter Demo Fest comes as Microsoft prepares a July launch of its
online advertising service meant to compete with Google and Yahoo.

Leveraging another of its properties, Microsoft unveiled a multilingual
interactive digital map of India. The map, a product of collaboration
between Microsoft and the Department of Science and Technologies’ Survey of India, was unveiled during Microsoft’s annual research gathering in
Bangalore.

The prototype map allows local residents to add tags indicating
polling places and other information. Compiled using geographic data
from the survey of India, the map provides both a countrywide viewpoint,
as well as a street-level map of Bangalore in multiple languages.

The online map employs technology from its TerraServer system of
digitized maps and is also used by the company’s online Virtual Earth.
Launched in 2005, Virtual Earth is Microsoft’s answer to Google Maps.

Although India’s mapping project has ties to Microsoft products, the
software goliath may be looking farther ahead, according to analysts.

“There’s not necessarily a direct tie-in between the map of Bangalore
and Microsoft’s current strategy,” said Matt Rosoff, lead analyst at
Directions on Microsoft.

“Microsoft understands that location-based
technology could have a lot of applications in the future, including
mobile phone applications and location-based advertising.”

The adLab demos include “Project Mercury: local and mobile ads” as well as
pay-per-call mobile ads.

“There are no current plans to productize the digital map with existing
Microsoft products,” according to Microsoft’s statement.

Today’s adLab announcement is purely focused on enabling Microsoft’s
advertising service to gain the upper hand over rivals Google and Yahoo.

“Microsoft is looking at ways to capture more data about
users, such as their location and interests, so that online
advertisements can be more relevant and therefore result in higher
click-throughs and conversion rates,” said Rosoff.

Microsoft’s China research program was shaken in 2005 when rival Google
hired Kai Fu Lee from Microsoft.

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