Online Advertising Splits Microsoft-Bell Partnership
One of Canada’s biggest online partnerships will end their 5-year relationship this week and will begin competing with each other. In 2004, Microsoft Corp. and BCE Inc’s Bell Canada joined forces to monetize the Internet via subscription services.
This resulted in the web portal simpatico.MSN.ca. Each site is expected to refresh its own version today, leading to MSN.ca and simpatico.ca. The two companies have agreed that the separation will give them greater flexibility to pursue their own online strategies.
The main reason for the split: the success of online advertising.
“Six or seven years ago, Microsoft’s view was that the way to monetize the Internet was through subscription services, and we felt we needed partnerships with phone companies around the world to distribute them,” says Owen Sagness, vice-president of Microsoft Canada Co.’s consumer and online group. “As it turned out, by the time we implemented, the online advertising world was showing signs of life.”
Bell and Microsoft signed a new three-year arrangement where the two will continue to share some web traffic and services. Microsoft will let Bell sell ads on its Hotmail and Messenger services. Meanwhile, Bell will use Microsoft’s new search engine Bing as the exclusive tool on Sympatico.
Microsoft has added about 60 advertising and editorial staff to prepare for the launch of the new version of MSN.ca. Bell, on the other hand, will keep its Sympatico head count stable. Both companies will compete with the joint portal run by their rivals Rogers Communications Inc. and Yahoo Inc.
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