Microsoft acquires ad exchange company

Microsoft has acquired AdECN, a company that offers what it describes as a stock market for display ads.

AdECN earlier this year launched an auction-based exchange for online advertising. Members can buy ad inventory for advertisers and sell on behalf of publishers. It currently has 37 member advertising networks, said Kevin Johnson, president of Microsoft's platform and services division.

The acquisition will complement Microsoft's AdCenter and extend the technology offered by aQuantive, another company that Microsoft is in the process of acquiring, he said. AdECN, based in Carpenteria, Calif., will expand Microsoft's capabilities by offering an auction exchange for display ads, he said.

The companies have not revealed terms of the AdECN deal.

Speaking during Microsoft's annual financial analysts meeting, Johnson described an aggressive push at the company to grow advertising services. Microsoft now serves ads with search and nonsearch, offers tools for publishers and advertisers, and will own one of the largest digital media advertising agencies, in Avenue A, an arm of aQuantive. Other recent acquisitions including ScreenTonic, which delivers advertisements to mobile devices, and Massive, for in-game advertising, round out Microsoft's advertising push.

"Now we're going about bringing these assets together in an integrated way," Johnson said.

The aQuantive acquisition should close by mid-August, he said, shortly after that company's shareholders vote on the acquisition. Defending the price of that purchase -- the deal is worth $6 billion -- Johnson said that Microsoft was competing with two other prospective buyers in an aggressive bidding situation, he said. "aQuantive was a unique prized asset," he said.

He called fiscal year 2007 a "foundational year" for online advertising and services for Microsoft.

Johnson spoke to financial analysts at a yearly meeting held at Microsoft's Redmond, Wash., headquarters.