Microsoft in talks to buy mobile ad network Tweet

Microsoft is close to finalising a deal to buy US mobile advertising network Millennial Media say industry insiders, a strategy that mirrors recent moves by arch rivals Apple and Google. According to sources at Business Insider, Microsoft has been negotiating with Millennial for the last two months and the companies have agreed on basic terms. The deal has been a long-standing rumour in the mobile advertising industry and follows Google’s US$750 million acquisition of AdMob last year – a deal still being looked at by US anti-trust regulators – and Apple’s US$275 million purchase of Quattro Wireless in January. Such deals have been made to capitalise on the fast-growing market for delivering advertising over smartphone platforms. According to Nielsen, Millennial reaches more than 80 percent of US mobile Internet users.

Despite the rumours of an impending deal, experts are sceptical whether Microsoft needs to acquire Millennial Media to compete in the mobile ads space. Business Insider notes that the software giant already has mobile ad products in-house, including some via its acquisition of mobile ad firm ScreenTonic in 2007. It also pointed to Millennial’s likely high price tag – estimated at over US$500 million – suggesting that even cash-rich Microsoft may decide it is money best spent elsewhere. However, the report notes that a deal would be useful in expanding Microsoft’s mobile ad business beyond the deals it strikes with operators such as Verizon Wireless to use its Bing search engine. “Acquiring Millennial could quickly give Microsoft broader reach across more publishers and in mobile apps on the iPhone, Android, and other platforms,” the report said.

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