Microsoft Goes Back to the Future Vs. Google, Apple - ' Why is This Deal '
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Why Is This Deal a Party?
As I said earlier, Microsoft and Viacom already were partners. Much of today's announcement formalizes existing deals, sets a clear timetable and monetary value on the arrangements, and clears the way for broader content and advertising sharing.
The ad deal helps legitimizes Microsoft's aQuantive assets and gives the company a big, showcase customer in Viacom.
Make no mistake: Microsoft will seek to advertise across multiple channels in all future deals. Microsoft rightly recognizes that Google's advertising approach, while expanding beyond online search, isn't broad enough to capture the wealth of advertising.
Microsoft is taking a similar multichannel approach to music and video content. Apple's iTunes Music Store movie, music and TV content is largely tethered to computers, iPod or Apple TV. Microsoft is leveraging its large Windows Media Center install base (including Vista), MSN and Live Services, Xbox, Windows Mobile-based phones, and Zune. Microsoft's challenge will be providing audio and video content, games and advertising ubiquitously across all of these platforms.
The question: After Viacom, who next will cut a similar deal with Microsoft? Nobody partners like Microsoft. In the 1990s, deals like this one helped Microsoft make a place for Windows on the Web. Through smart deal making, Microsoft helped ensure that Internet Explorer would be the main means for consuming Web content. Today, content providers are seeking new channels. Meanwhile, through the Web, Google transforms advertising. Microsoft wants to maintain its products' relevance in part by providing technology for delivering content, ads and demographic tracking to anyone, anywhere and on anything.
Microsoft can get there one deal at a time.
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