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Bing! Microsoft Scores in Razorfish Sell-off

August 9th, 2009 Leave a comment Go to comments

microsoftbing1We all know how much I love to hate Microsoft. And today that love grows. It appears Microsoft has finally sold interactive agency Razorfish. And Publicis Groupe SA is the proud owner, out roughly $530 million. Sounds innocent enough, right? What does Microsoft want with a digital agency anyway? Makes sense to sell it off, yes? Well apparently, as part of the deal Publicis agreed to place some pretty hefty media buys into Microsoft’s properties including new search engine, Bing.

And there’s the rub. On the face of it everything looks innocent enough. And sure, Bing has plenty of users so it’s not like Publicis is agreeing to prop up a site that won’t supply reach. But if I was a Razorfish client, I’d have to wonder if my account is going to be one of the lucky victims of an automatic Bing buy. And does Publicis have a plan to charge premium rates on this discounted space? Or is that discount passed on to the customer? And hmmm. Has this Razorfish sell-off been strategically timed to coincide with an urgent need for an influx of advertising buys to propel Bing? Could it beeeeee, Sataaaaaan?

These are the kinds of questions that sometimes pop up when pondering the activities of Microsoft.

But seriously. The deal smells like roses. With that faint odorous whiff of conflict of interest.

But aren’t those executives quick with the comebacks. A Publicis digital exec from Vivaki assures clients there’s “no bias or no commitment to buy from Microsoft.” However, according to the Wall Street Journal, “as part of the wider deal, Publicis clients will be able to purchase display and search advertising from Microsoft on favorable terms, in exchange for certain minimum guaranteed aggregate purchase levels.”

Is it just me or do the words “minimum” and “aggregate” sorta work together to spell out:

YOU-WILL-BE-ASSIMILATED.

And let’s not even get started with “guaranteed” which somehow found its way into what was supposed to be an innocuous, lilac-scented sentence.

Maybe I’m just an old-fashioned ad girl who still thinks agencies owe clients the best media deal available. The most efficiency, the best placements, the perfect medium for their strategic objectives. That’s the job of an agency, right? It’s not about the agency, it’s about the client. Agencies are agents. Agencies don’t make deals for agencies, they make deals as agents on behalf of clients. That’s what makes this whole enchilada work. When agencies start making deals that they need to later back-end clients into, it all just turns to masa.

The “minimum” “aggregate” and “guaranteed” thing. That bothers me. When I hear an agency talk I want to hear “efficient” “effective” and “no obligation.”

And can an agency really achieve that in a deal with el diablo? Sounds to me like the soul’s already been sold.

Still not sure? Go ahead. Bing and decide.

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  • Alex, great response. Totally agree on the anti-trust issues. Of course that's something Microsoft is no stranger to.
  • I'm sure the players on both sides are prepared to eloquently defend the deal. At the end of the day it just seems like the timing was a little too strategic for Bing, which naturally leads to the belief that the terms between Microsoft and Publicis (namely the media buy) are a little more definitive than either side is prepared to admit. So far there's been two distinct facts stated that are in direct contradiction. Is there a "minimum, aggregate, guaranteed" expectation? Or is there "no bias or no commitment" and no expectation? Hmmm.
  • The real individuals who should be shouting foul are not the clients, but other digital agencies. It is not the terms "aggregation" or "minimum" spending that concerns me, but rather "clients will be able to purchase display and search advertising from Microsoft on favorable terms,..."

    Here, we can read it as Razorfish is getting a discount on top of what they negotiate which is passed back to the client. In the case of Pay-Per-click media - when purchased on the bid model - a client will now pay even less then its competitor regardless of what position the ad appears in, and even if both have the same media spend. At this point Razorfirh has have done its job and done it well. However, this is no longer provides competitive market place, but now starting to smell like an Anit-Trust issue.
  • I always wondering what Microsoft was doing purchasing Razorfish in the first place. That seemed like a "keeping up with the Pages & Brins" move at the time. But maybe the sale is more sinister than the purchase....
  • Bring on the ol' fashioned girls! We absolutely owe clients the best media deal available. I like to divide the agency world in to halves... the half that gets it and the other half that are just a bunch of waiters and waitresses who merely take orders! (sigh)

    El Diablo! Buahahahaha!
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