Microsoft muscles into YouTube territory with new video advertising service

Microsoft is responding to the shift in marketers’ budgets from TV to online (Getty Images)

Microsoft is to launch a new video advertising service in Britain as it seeks to grab a share of the market that is dominated by Google’s YouTube.

The Microsoft Video Network lets advertisers buy video ads on a targeted and automated basis — known as programmatic trading because it uses computer programming algorithms.

Owen Sagness, general manager of Microsoft Advertising UK, said the company was responding to the shift in marketers’ budgets from TV to online.

“We have a very rich creative platform,” he claimed, explaining how video ads can appear across Microsoft’s services from the MSN portal and Outlook email to search engine Bing and chat service Skype.

He added Microsoft also offered a wider “brand-safe” environment for advertisers to buy video ads on 350 approved third-party publishers’ sites.

Mr Sagness said programmatic advertising is “an area of massive growth”. Some industry forecasts suggest it could hit £6 billion of UK ad sales by 2017.

Microsoft generates an estimated $3.5 billion (£2.1 billion) a year in digital advertising and overtook Yahoo last year to become the third biggest player worldwide behind Google and Facebook, according to the research firm eMarketer.