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Microsoft and OpenX in deal to boost their online ad businesses

The software giant will use its clout to refer larger corporate clients to the Pasadena firm, which operates one of the nation's largest independent Web advertising networks.

November 03, 2009|David Sarno

Microsoft Corp. and OpenX Technologies Inc., a Pasadena-based Web advertising start-up, have struck a deal that would enable both companies to expand the reach of their online ad businesses.

OpenX, which operates one of the nation's largest independent online advertising networks, develops software that enables marketers to funnel ads to websites that are visited by the type of buyers they are targeting. Similarly, advertisers use Microsoft to create and distribute ads, be they for flowers, movies or Maseratis.

Under the deal, OpenX will increase the potential reach of those ads by making them available to its network of 150,000 websites, which display 300 billion ads every month. Microsoft competes with Google Inc. and Yahoo Inc. in the fast-growing online ad market.

In return, Microsoft has committed to using its clout to refer larger business customers to OpenX, which also helps companies tailor websites to increase advertising revenue.

Most of the software offered by 3-year-old OpenX is based on open source technology -- built by communities of volunteer experts -- and available for free. As such it has attracted smaller, less financially able websites looking to make money by selling ads.

Microsoft called the alliance an early step toward an "open ecosystem," in which site owners and marketers have a variety of choices for how and where to place advertisements.

Financial terms of the multiyear deal weren't disclosed. But Microsoft said no revenue would be shared.

"It's the beginning of a partnership," said OpenX Chief Executive Tim Cadogan, a former ad executive at Yahoo.

He said being attached to Microsoft added credibility to "what we're doing and hopefully kicks us up to another level in terms of industry awareness."

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david.sarno@latimes.com

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