Microsoft buying online ad exchange

SAN FRANCISCO (AFP) - Microsoft announced yesterday it is adding another weapon to its arsenal in the battle for online advertising dollars with the purchase of Internet ad exchange AdECN Inc.

Word of the planned acquisition comes as Microsoft rivals Google, Yahoo and America Online (AOL) acquire firms specializing in tailoring Internet ads to the tastes or interests of website visitors.

Google is expanding its online advertising empire to video and graphics realms with the purchase of ad-targeting powerhouse DoubleClick and Microsoft is in the process of buying DoubleClick competitor aQuantive Inc.

Time Warner subsidiary AOL said this week it is acquiring TACODA, a New York City start-up that uses "behavioral targeting" to calculate which online ads are likely to result in money-making "clicks" by Internet users.

Yahoo bolstered its position in the fast growing multi-billion-dollar Internet advertising market by taking over online advertising exchange Right Media.

AdECN was founded in 2003 and, like Right Media, has an exchange that serves as an online marketplace for buying and selling Internet display advertising, according to Microsoft.

Financial terms of the deal to acquire AdECN were not disclosed.

"Joining forces with Microsoft will provide the capital and resources to enable AdECN to scale the exchange at a much faster pace," said AdECN founder William Urschel. "All of us here are thrilled."