As Google continually gobbles down on the online advertising industry, it stings the other giants like Microsoft and Yahoo.  However, both of these companies aren’t letting that hold them back from spending some big bucks to stay in the game.  The shocker that was recently announced was Microsoft’s agreement to acquire AQuantative, a solid online advertising and marketing firm, for a measly $6 billion.  Wait, did I say measly?

That’s a Lot of Cash!

No matter how big Microsoft is, the $6 billion dollar purchase came as a shock to a lot of people.  It’s the largest purchase in Microsoft’s history, and might not even give them the results they want.  Microsoft is attempting to gain more advertising market share, which is dominated by Google’s worldwide dominance.  Microsoft makes only about 10% of what Google makes in advertising each year, which doesn’t make them much of a competitor.  The fact is, though, that Microsoft really doesn’t have the time to start developing the platform they would need to catch up with Google, so acquiring AQuantative was a much easier and faster solution.

Google Definitely Took a Bite Out of Microsoft

When Google purchased DoubleClick, I think it made Microsoft shake in their boots.  Microsoft’s hold on the online advertising world is pretty loose right now, so AQuantative seemed like an easy way to make up for lost time.  It makes complete sense for Microsoft to get in the game, but the price tag seems a bit outrageous.  I think it just came down to few other logical alternatives and AQuantative came in at the right time.

At Least Joining Forces Will Be Easy on the Employees…

Luckily for Microsoft and AQuantative, good spirits will remain constant due to the geographic location of both companies.  They are located in the Seattle area which will make the merging of the companies a little easier on the employees.  As of now, no one is being laid-off, which will keep everything on good terms and boost productivity.

Microsoft Assumes Their Investment Will Eventually Pay Off

The growing digital advertising marketplace is estimated around $40 billion and that is gaining a lot of momentum, so Microsoft has determined that their large $6 billion investment will pay off.  Granted, Avenue A/Razorfish, which creates ad campaigns and Web sites for Ford, Best Buy, and Coors, will bring in a large amount of revenue by itself.  This sector of AQuantative brings in over half a billion in billings alone.  With Microsoft on the same side, It is likely that the merge can lead to bigger and better things.

Is It Too Late For Microsoft to Catch Up?

But is it too late for Microsoft to capitalize on the Internet advertising world?  While many people believe it is, it might not be.  There are definitely some major advantages to the acquisition of AQuantative. Now Microsoft will be able to branch out from their main advertising sources like MSN, Windows Live, and various video games and design campaigns and place ads for all kinds of advertisers on all kinds of sites.  After all, AQuantative is the largest interactive ad agency in the U.S., and Avenue A/Razorfish will put Microsoft in power of both selling and buying online ads.

More Tools for Internet Marketers… but Is It Enough to Turn Them Away From Google?

Microsoft is going to be able to provide an Internet-wide advertising platform, tools, and services to help generate the highest possible return on advertising investments.  Internet marketers will have a tool set to develop, target, and execute online advertising campaigns unlike current resources.  Not only that, Microsoft’s client base will be greatly broadened by AQuantative, which will help the company gain traction on its AdSense platform. Internet marketers will definitely have some new options with the Microsoft platform, but I’m not sure if we’re going to see people turn away from the streamlined approach that everyone has gotten from the Google team.

Google Won’t be Holding Back While Microsoft Tries to Catch Up

Google’s reputation and services are quite remarkable.  I have a hard time believing Microsoft will catch up.  As Microsoft develops, Google isn’t going to be standing still.  If past trends hold true, Google will have more tricks up their sleeve than Microsoft and their $6 billion investment might fall short.  The competition from Microsoft is going to add a lot of energy to the Internet marketing world, though, which always brings about the betterment of services and products.  Only time will tell how this investment for Microsoft will pan out, but I think we’re going to see some interesting stuff taking place in the world of Internet advertising really soon.

Sharing the Space is Gonna Be Rough

AQuantative will make Microsoft a much stronger player, but it probably won’t launch them to the top just yet.  Don’t get me wrong, though; there are substantial options behind this acquisition.  Microsoft is really building a whole new business leg onto their foundation, and no longer focusing solely on software and PCs.  We are definitely seeing a loss of barriers in the digital world, and it will be interesting to see how these giants handle sharing the space.