Digg shafts Google for Microsoft ads and technology

Stan Beer
Thursday, 26 July 2007 07:44

Your IT - Home IT

Hot on the heels of a report that Microsoft has gained search marketshare on Google comes the news that popular Web 2.0 news aggregator Digg has given Google the flick for an exclusive advertising deal with Microsoft. Digg has given hints that the provision of Microsoft technology is part of the deal.

The Digg contract is the second major Web 2.0 advertising deal for Microsoft following a similar deal with Facebook signed in August 2006.

Like the Facebook deal, which runs until 2009, according an Associated Press report the Digg advertising will be for three years for an undisclosed sum.

In a somewhat somewhat perplexing statement, Digg co-founder Kevin Rose said the decision to go with Microsoft was made because of the size of the company and its technology.

Rose wrote on Digg the Blog:

"This move gives us an advertising partner with a larger organization and a more scalable technology platform to keep pace with Digg’s growth. Best of all, it lets the Digg team completely focus on new feature development. Federated Media, which has been an awesome partner for the last year and a half, will continue working with Digg focusing on integrated sponsorships and custom programs like the Arc project in labs."

The implication is that the deal was done at least partly because Microsoft is able to supply Digg with a more scalable server and content management platform and will be a technology partner as well as an advertising partner. With between 10 and 15 million visitors a month, depending on whose stats you believe, Digg has been hit with performance issues in the past.

Importantly for Microsoft, the deal with Digg may provide a glimmer of a strategy to combat the dominance of Google in the online advertising space. With the ability to provide web publishing clients a vertically integrated technology solution, Microsoft may be able to claim a differentiator from Google.

Reactions on largely anti-Microsoft Digg to Kevin Rose's posts have been surprisingly muted to date, suggesting that visitors to the site could care less about what's under the hood powering the site and who the site uses to serve its ads.