Silicon Valley Watcher - Former FT journalist Tom Foremski reporting from the intersection of technology and media

MSFT Must Acquire Media Or Miss Gold Rush

Posted by Tom Foremski - May 9, 2008

BusinessWeek's cover story aims to analyze how Microsoft will take on Google without Yahoo. It boils down to MSFT's top salesman Keith Lorizio.

Foremski's Take:

Even if MSFT had a hundred Keith Lorizios - it wouldn't do much good. Because there is no way that it can grow its ad business organically to match the flood of money moving into online ads.

Microsoft said it itself, when it launched its bid for YHOO:

The online advertising market is growing at a very fast pace, from over $40 billion in 2007 to nearly $80 billion by 2010.

The online advertising market will double in three years! Even if MSFT doubled its online ad business every year for three years it would reach about $24 billion out of a total of $80 billion leaving billions on the table for competitors.

Even if MSFT executed brilliantly in its organic efforts it would still miss what is probably the biggest gold rush opportunity in advertising since the radio was invented.

That's why MSFT needs to make media acquisitions -- and quickly.

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Please see:

Analysis: Quick Deal Critical To MSFT's YHOO Bid As Online Ad Markets Set to Double Over 3 Years

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