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Viacom Snubs Google, Inks $500MM Ad-Content Deal with Microsoft

Viacom’s new $500 million advertising and content deal with Microsoft will see Viacom switching to Microsoft’s advertising system from DoubleClick.

The move has industry insiders wondering if Microsoft is using the deal to make a statement to Google, which is purchasing DoubleClick for $3.1 billion, writes the Seattle Post-Intelligencer’s Todd Bishop in his Microsoft Blog.

Viacom is suing Google for alleged copyright infringement on YouTube. In a statement, Philippe Dauman, CEO of Viacom, said the dispute had no bearing on Viacom’s switch to Microsoft’s ad serving platform.

In addition to using Microsoft’s Atlas ad program to serve ads for Viacom’s U.S. websites, Microsoft will buy ads on Viacom’s cable and online networks, while Viacom will become a publisher partner across Microsoft’s casual-gaming platforms, AdAge reports.

Television and movie content will be available over Xbox Live Marketplace and MSN as part of the deal, writes gamesindustry.biz. Will Freeman of the Xboxer blog points out, “Previously it was reported across the internet that episodic material and TV shows were unlikely to be a part of the Xbox Live Marketplace Video Store movie rental service, but now it seems that could be all set to change.”

Viacom’s digital properties doubled their revenue in 2007 to $500 million, and have now “reached the scale to build on the increased functionality and traffic those properties are starting to attain globally,” said Viacom CEO Philippe Dauman.

Video advertising, which will accompany all of Viacom’s TV content, is the fastest-growing online ad format. It is expected to rise 74 percent in 2008 over 2007, to $1.4 billion, and to grow to $4.3 billion in 2011.