Facebook Inc said on Thursday it had
agreed to buy advertising technology from Microsoft Corp that measures
the effectiveness of ads on its website, which should help in its fight
with Google Inc for online advertising revenue.
Under the long-rumored transaction,
Facebook will purchase the Atlas Advertiser Suite, an ad management and
measurement platform that Microsoft took on with its $6.3 billion
acquisition of digital ad agency aQuantive in 2007. Facebook did not say
how much it paid for the technology.
Unable to make it work for its own purposes, Microsoft wrote off $6.2 billion of the aQuantive deal's value last year.
Facebook has long been dogged by doubts
about the effectiveness of its ads and was embarrassed just days before
its initial public offering in May when General Motors Co declared it
was pulling the plug on all paid advertising on Facebook's network.
Since then, Facebook has introduced a
number of tools and partnerships to prove to marketers that advertising
on its social network delivers enough bang for the buck.
Brian Boland, Facebook's director of
monetization product marketing, said the purchase of Atlas was not a
step toward creating a much wider ad network beyond the Facebook site,
but analysts believe that is Facebook's ultimate goal.
"Although the statement announcing the
deal focused on Atlas' measurement tools rather than its ad targeting
technology, we expect that Atlas will soon be using Facebook's data to
target sponsorships, in-stream ads, and other rich ad formats across the
entire web, and that's big news," said Forrester analyst Nate Elliott.
"The question now is how quickly and
successfully Facebook can integrate its data with Atlas' tools, and
whether they can avoid a privacy backlash as they do so.
History suggests they'll struggle on both counts," he said.
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