Microsoft, Yahoo and AOL are teaming up to compete with Google in advertising, according to a report that the three Internet giants hosted a dinner last night to discuss their plans.
Update: A Yahoo spokesperson tells WebProNews, "Choice in the digital marketplace is critical. As the media world continues to fragment, the value that premium publishers deserve also fragments. We believe strongly in the premium content ecosystem and the importance of matching publishers, agencies and advertisers with premium formats. At Yahoo, we're fortunate to have deep, longstanding relationships with brands, publishers and agencies, and are working on dynamic and innovative ways to put value where value is due. We also have longstanding relationships with AOL and Microsoft and will continue to partner and compete in the years to come."
A Microsoft spokesperson gave us a similar statement: "“We believe that choice, openness and competition help drive innovation in the market. As such, we are always looking for ways to partner with others in the digital advertising ecosystem to offer innovative solutions that benefit advertisers and publishers. However we have nothing specific to share at this time.”
Peter Kafka at All Things D reports:
The idea, according to people who attended the meeting: Microsoft, Yahoo and AOL have agreed to sell each other’s “Class 2 display” inventory — graphic ads the companies can’t sell on their own and would normally hand over to ad networks.
The theory is that if, say, AOL has a big order for a certain kind of ad impressions, it will fill it with its own inventory as well as what’s available from Microsoft and Yahoo.
According to the report, revenue would be shared among the three companies, and it will begin this year.
We've reached out to each company, and will update as more info becomes available.
The move of course comes after a search and advertising partnership between Microsoft and Yahoo, which went into effect over a year ago. The latest search market reports have their shares increasing with Google's declining (albeit, just slightly).
It will be very interesting to see how this new deal affects the advertising market.