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Microsoft is prioritising plans to develop a one-stop shop for internet advertisers in its bid to catch Google and take a bigger share of web advertising.
Microsoft, which recently spent $6bn cash buying Aquantive, the US advertising technology and agency group, believes advertisers want a single platform for buying and analysing all their increasing spend on web campaigns.
It is prioritising its drive to stitch together all Microsoft advertising businesses across the web, gaming and mobile in a bid to dislodge Google, the leading internet advertising group.
This week Yahoo, once the leading internet advertising company, announced Terry Semel, its chief executive, was stepping down, reflecting concerns at ground lost to Google.
Speaking at the Cannes Lions Advertising Festival, Yusuf Mehdi, Microsoft’s chief advertising strategist, told the FT: “There is going to be one internet advertising platform for us that is going to serve across search, display and all IP-enabled media.
“That is just the trend of the future. Advertisers want to buy as simply as possible and they want analytics across all the platforms, and you can only do that with one platform.
“This is a business where the scale of investment to provide such a platform is only available to a few large providers.
“I don’t know enough to say whether it is two or three or four major companies, but I certainly believe there will be room for two.”
Google is built around its successful internet search business, but its acquisitions of YouTube, the video-sharing website, and Double Click, the leading distributor of internet display or brand advertising, have shown its own intent to diversify.
The internet sector has seen a spate of such deals as both technology and marketing companies try to broaden the range of services they provide on the web.
Such consolidation is welcomed by some industry executives. But others believe it will result in web advertising being concentrated in the hands of a few companies.
Consumer groups are also concerned that the dominant web companies will be able to gather data on people’s surfing habits and interests.
Google has often been the subject of such data fears.
In many instances, however, it has fewer opportunities to collect personalised data on web users than rivals such as Yahoo or Microsoft.
The latter pair are more prominent providers of email and other servcies which require users to provide their details when subscribing.
Mr Mehdi said Microsoft had historically been “a leader” in privacy policies among internet companies, and said in future consumers would decide between companies based on their data protection.
He said: “I do believe that. We are going to stake a large part of our value proposition on that notion. I think that is an important consideration for customers.”
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