Microsoft partners with OpenX in new move vs. Google AdSense

After flying under the radar for a couple years, Microsoft is looking to make its Content Ads system a more legitimate rival to Google AdSense for serving ads on third-party web sites. The Redmond company took a step in that direction this morning, announcing a partnership with OpenX Technologies that’s designed in part to give the Microsoft system access to a larger base of online publishers.

The partnership creates a stronger link between Microsoft and a company with some interesting industry connections. Tim Cadogan, the OpenX chief executive, was a longtime Yahoo executive — working as the company’s vice president of search before heading up its global advertising marketplace. OpenX’s chairman, Jonathan Miller, is the former AOL CEO recently named News Corp’s Digital Media CEO.

The arrangement with OpenX “helps us build one of our businesses that we have pretty ambitious plans for,” said Scott Howe, vice president of Microsoft’s Advertiser and Publisher Solutions Group.

OpenX, based on open-source ad-serving technology, says it works with more than 150,000 independent sites that collectively serve more than 300 billion ad impressions a month. OpenX will promote Microsoft’s Content Ads system to those publishers, allowing ads from Microsoft’s system to be served on their sites. As part of the deal, Microsoft will also refer corporate customers to OpenX for some ad-serving technologies.

The deal is also an example of Microsoft’s increasing willingness to partner in some areas with companies it competes against in other areas. OpenX separately operates an ad exchange called OpenX Market, in a segment of the industry that Microsoft is moving into through its acquisition of the AdECN ad exchange.

Microsoft seems to recognize that “adopting a partner who’s also in the same field to provide a broader set of solutions for end customers can actually be a good thing,” OpenX’s Cadogan said. “That’s one of the things that’s an interesting symbol of Microsoft’s increasingly open approach, at least from our point of view.”

On top of that, he said, the Redmond company’s decision to work with an open-source company “is a signal of some interesting evolution in the Microsoft strategy.”

Financial terms of Microsoft’s OpenX deal weren’t disclosed. The partnership follows a trial that began in August 2008. – Techflash