Microsoft isn’t as much of an advertising company as, say, Google and Yahoo, both of which rely on advertising dollars for the majority of their revenues and profits. That doesn’t mean, however, that Microsoft doesn’t care about ad revenues. A new rumor has it that Microsoft might purchase mobile ad platform InMobil, if true, makes the company’s interest all the more obvious.
As investment site Seeking Alpha reports, Microsoft is allegedly beating out both Google and Yahoo in the acquisition, with a target price of close to $2 billion. Certainly, Microsoft has the cash for such acquisitions, and with Microsoft smartphone platform suffering in terms of gaining market share, Microsoft needs to increase its presence in advertising via the other, vastly more successful mobile platforms. Think of it as Microsoft’s cross-platform strategy for ads.
Seeking Alpha points out that Microsoft is InMobi’s largest customer, which means the acquisition would make for a good fit and likely bring built-in financial benefits to Microsoft. Rather than paying InMobi a cut, all advertising dollars would show up on Microsoft’s balance sheet. That’s a win-win for everyone.
Microsoft continues to make some bold moves in this space, in both directions. The company made some noise when it handed over its display advertising business to AOL, while in other deals Bing has become the search engine for the likes of Apple’s Siri and the AOL search traffic that powers the display ads that Microsoft no longer manages itself. Advertising and search are complicated businesses, clearly, with all sorts of permutations and combinations–the process of sorting through tactics to accomplish strategic goals must give Microsoft executives massive headaches.
Nevertheless, with the InMobil purchase, Microsoft gains another foothold into iOS and Android, and one might argue that Windows 10 Mobile thus becomes a little less important. There’s no doubt about it–2016 is going to be a very, very interesting year in determining the future of Microsoft’s smartphone strategy.Further reading: Advertising, AOL, Bing, InMobi, Microsoft, Mobile, Siri, smartphone, Windows 10 Mobile