Upfronts 2010: Microsoft Makes Its TV Pitch

U.S. digital ad sales chief outlines software giant's plans to take a slice of the TV ad market

By Alex Weprin -- Broadcasting & Cable, 4/6/2010 10:28:59 PM

Upfront Central: Complete Upfront Coverage from B&C

Microsoft is continuing its efforts to get a slice of the television upfront market, rolling out new content offerings and packages to advertisers looking to reach engaged users, according to Keith Lorizio, Microsoft's VP of U.S. digital ad sales.

In a live Q&A with B&C Business Editor Claire Atkinson at B&C's Upfront Central event, April 6 at New York's Roosevelt Hotel, Microsoft VP of U.S. Digital Ad Sales Keith Lorizio discussed the company's efforts in a number of areas, including through its Xbox Live service.

"Are we competing for TV dollars? Yes," Lorizio said, noting that the Xbox service--which originally served as an online gateway for gamers to play one another online but has evolved into a true multimedia set-top box--is in 20 million homes worldwide, with 72% of those in the U.S.

Microsoft is also expanding its original programming, with an added focus on interactivity. The second season of Endemol's 1 Vs. 100 just finished its run on Xbox Live. The game lets Xbox Live users play the game live each week, with a host asking a randomly selected user questions. Winners get Xbox Live marketplace points (redeemable for games and downloads) and free downloads. Microsoft worked with Nielsen to measure viewership for the series, an important step as the series relies on ads similar to those on network television for revenue. Sprint served as the sponsor for the series.

"You have online users competing from across the globe," Lorizio said. "It is very much an experience that cannot be duplicated on TV."

Lorizio also said the company is interested in a digital upfront, which would let ad buyers commit money to programming and content they believed could deliver results for the brands they represent. Microsoft has held events in the last couple of years but is looking to expand them. "I am passionate about that; I think it would help both parties," Lorizio added.

The company also sells scatter ads for television networks on a CPM basis, and counts NBC Universal and A&E Networks as clients.

But Microsoft is not ignoring its bread & butter: digital advertising. With the MSN Network, MSNBC.com and Fox Sports on MSN consistently among the most popular Websites on the Internet, there is ample opportunity for brands looking to reach a wide swath of people. To that effect, Microsoft once again inked a deal with Discovery Communications, which last year launched a campaign across the MSN Network, Microsoft's mobile platform and on Xbox Live to promote the fourth season of Deadliest Catch. In 2010, Discovery is making a similar buy for the new season of the series, and also made a buy for its special miniseries Life.

Of course, Microsoft is also a major ad buyer itself, with ads for a number of products running regularly across a number of television channels. With Apple's iPad launching to major buzz, Lorizio says that the next wave of Microsoft commercials may have a different tone than the genial "I'm a PC" campaign.

"I think there is a little bit of aggression that is held back," he said. "I would expect that to change very quickly."

And Microsoft needs to stay aggressive. Despite having a market cap rivaled only by Exxon-Mobil, challengers like Apple and Google are beginning to make their mark, both through devices like the iPad and iPhone, and with free software like Google Docs, which competes with Microsoft's dominant Office software..

"The advertising business is absolutely critical to Microsoft as it moves forward," Lorizio said. "Shrink-wrapped software on the consumer front is changing; people are demanding stuff for free."