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Microsoft is buying Navic Networks, a Waltham, Mass. based company that specializes in serving ads on the TV screen, via digital cable networks. The deal announced yesterday is Microsoft’s most aggressive foray into advertisement, albeit offline advertisement ever since talks with Yahoo ended in a stalemate. Although Microsoft couldnt get its hands dirty with Yahoo, the company has still managed to bag some comparative smaller ones specially in the advertisement market segment. Last year Microsoft acquired Right Media for $1 billion, after it lost the battle to rack in Double Click. Double Click turned down Microsoft’s larger bid to get in bed with Google.
Navic Networks specializes in commercials that are designed to be engaging and interactive and target them on the basis of certain demographic factors. The company’s application software sit inside set top boxes that makes our dumb TV set interactive and allows us to communicate with the medium and not just consume it, that’s exactly what Web 2.0 is all about.
The ad is displayed as an overlay and allows users to interact with it, i.e they could request more information about the product, or whether it is available on Amazon or some other large retail outlet. Organizations could use a set of features provided by Navic to improve their campaign. Some of these features include profiling users to know which one of them would be better suited for longer ads, targeting impressions, which overlay information to be displayed to which users, and a host of other features.
The deal is not a mock or something, it has given Microsoft instant access to Television advertisement market which racked in $71.3 billion in 2007 alone. Compare it with $21.2 billion in online advertisement, a market that Google dominates to get a little perspective on this deal. Navic already has access to 35 million digital set top boxes in the US.
The terms of the deal were not disclosed. Navic raised $43 million in venture investment to-date. The acquisition has pitched Microsoft against Google which has only recently launched TV Ads in April and have also included some metrics and analytics features for advertisers to know how well their ads are performing.
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