26 July 2007

Digg signs advertising deal with Microsoft

Digg signs advertising deal with Microsoft Digg has signed a new advertising deal with a new advertising partner - Microsoft. The three year deal means that Microsoft will exclusively provide the display advertising and keyword targeted adverts on the Digg site.

Digg aggregates content from all over the internet, from tiny blogs to huge internet portals. Anything that is of interest to the community there will receive positive votes and will be promoted up the rankings. The variety of content that can be browsed through, coupled with the ability to vote for content you like, makes for an addictive user experience - leading to the site attracting 17 million unique users a month.

This is not an insignificant portion of the available ad audience. Microsoft is trying to gain market share in online advertising, and is especially keen to take revenue away from the market leader Google. And this many new users will only be a positive step for Microsoft.

Another attractive element of Digg for Microsoft is the demographic that use the site. 94% of the people that use the site are male, and the majority of them are young, technologically savvy web users with above average salaries. This is a key area that online advertisers are keen to reach, as they have a large disposable income and have typically stopped watching TV, reading magazines and other traditional methods by which people can be shown ads.

All parties involved in this deal are making positive sounds. Microsoft has issued a press release saying how excited they are to be working with a new partner, while Kevin Rose, Digg's CEO, made a statement in the company blog about the partnership - which was rapidly voted to the front page of Digg. Even the CEO of Federated Media, Digg's current ad serving partner, made a fairly upbeat statement on their company blog.

Perhaps the most interesting points of view to look at are those expressed by people who voted the blog statement to the front page. Here you see what the users of the site think of the deal. One thing that should be understood is that a large proportion of the Digg community is made up of dedicated Linux-using, anti-Microsoft nerds. There are plenty of very negative comments suggesting that Digg has sold out, people worrying about the impartiality of the site and also an awful lot of people chuckling to themselves as they have special software that blocks the adverts from their browser.

It's important that the Digg community is appeased, otherwise they'll move to another site en masse and remove the unique power that Digg has - the 17 million unique visitors that the site holds so dear. Bearing this in mind, it's difficult to see any major changes to the site being made. This will be a matter for the businesses involved and will provide more competition in the online advertising marketplace - which can only be a good thing.
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