26 July 2007

Microsoft replaces Google in Digg Ads

Microsoft replaces Google to become the exclusive online advertising partner of Digg, a popular user-recommendation news website, according to media reports Tuesday.

Under the three-year agreement, Microsoft will deliver ads -- mostly small, contextually relevant text links -- on Digg.com

The agreement would go into effect in the coming weeks. Financial terms were not disclosed.

Digg, which said it has more than 17 million visitors monthly, challenges the long-held journalistic assumption that editors know best what people want to read and allows readers to vote a favorite story onto a list of top news.

Digg's CEO Jay Adelson said his company also considered partnerships with Google and Yahoo, but chose Microsoft because of the level of customization the software maker offered with its advertising platform.

"We at Digg couldn't think of a better partner to get to where we need to go," said Adelson. "They're a young ad service, they're innovative, they're willing to work with us on the cutting edge."

Digg is the first high-profile customer for Microsoft's adCenter platform since the company signed up Facebook, a popular Web 2.0 property, social-networking site, last summer.

Web 2.0 is a catch-phrase for the new generation of Internet services that run on interactive software and typically rely on content generated by users to attract more visitors to sites.

With Digg and Facebook under its belt, Microsoft may be able to seal deals with other social networking sites.

"You'll continue to see us be aggressive in this field," said Steve Berkowitz, the head of Microsoft's online services group.

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