Tom Raftery’s Social Media

I see Microsoft are following Google into the Advertising business with their announced purchase of aQuantive for $6bn.

Advertising definitely seems to be where the money is at right now - as Michael Arrington put it earlier on TechCrunch:

Google bought Doubleclick for $3.1 billion in April. Later that same month, Yahoo acquired competitor RightMedia for $680 million. Just yesterday, WPP Group acquired yet another company in this space, 24/7 Real Media, for $649 million.

Just as an indicator of how seriously Microsoft is taking advertising as a revenue stream, this is Microsoft’s largest acquisition to-date. Look to Microsoft to start generating more and more income from advertising and less and less from the traditional software licencing model.

I suspect that we will see an online version of Office, developed in Silverlight, free to use and ad supported in the next 12 months.