Microsoft: Headed to be online hub, income from ads

Written on 28th July 2008                                                                                                              2 COMMENTS
Joop Dorresteijn, East Asia correspondent

Steve Ballmer at the Max 08 conference, Picture by Gorriti (CC)

Steve Ballmer held the keynote at the Microsoft Financial Analyst Meeting in Redmond last night and underlined the importance of succeeding in search and advertising. I have seen slides explaining that Microsoft wants to sell advertisements using platforms as Windows Live and Windows Mobile telephones. Ehm, what else is new?

In response, Don Resinger at Ars Technica is wondering how fast Microsoft can realize its online future. The company is dedicated to increase its online presence but got no results from six months negotiations with Yahoo. Also, Microsoft’s online unit has recorded losses of $1.23 billion (€78 million) in the last fiscal year, and announced to invest another $500 million (€318 million) last week. Where is Microsoft headed?

1. search Resinger thinks that acquiring Yahoo is the only way for Microsoft to become competitive with Google again.
2. Applications Microsoft has Silverlight and their successful Live services, and might become successful as a hub for people trying to work online from the desktop.
3. Advertising Microsoft has to become the exclusive ad-supplier and search for other online properties, also to keep out of Google’s grasp. Windows Mobile and Facebook can generate a potential 1 trillion online advertising value.

As Ballmer said, Microsoft’s future is online, but what is his exact strategy? Where do you think Microsoft is headed?

(Presentation slides from Microsoft Watch)