Redmond, Washington based software maker Microsoft has held discussions with British advertising holding company WPP Group Inc.  centered around selling its digital advertising agency Avenue A/Razorfish, according to a report published Monday in Advertising Age. In May 2007 Microsoft agreed to purchase Seattle-based online advertising agency aQuantive Inc. for nearly $6 billion, a deal that concluded last August and gave the world's largest software maker control of Avenue A and two other businesses, advertising network Atlas and targeting company DrivePM. Discussions about a deal to sell Avenue A/Razorfish began nearly six months ago without producing an agreement, an outcome the newly-reopened talks are seeking to remedy, according to the Advertising Age report which cites unnamed people near to the discussions. Microsoft Looks To Sell Ad Agency Avenue A, Razorfish To WPP Group Microsoft and WPP have also looked into a possible trade for Avenue A/Razorfish, according to the report, however some industry analysts expect that Microsoft may not let the ad agency go for a market value price placed by some at $800 million, for fear that a such a deal would reflect poorly on Microsoft's original $5.9 billion aQuantive purchase price. Microsoft may have an interest in WPP property 24/7 Real Media, an Internet marketing strategy firm with an online ad delivery business that could help Microsoft as it looks to compete with rivals Google and Yahoo. According to the Advertising Age report a trade could see Microsoft giving control of Avenue A/Razorfish to WPP in exchange for cash and 24/7 Real Media's Open AdStream system, which WPP acquired during its $649 million purchase of 24/7. Microsoft purchased aQuantive after Yahoo bought online ad company Right Media Inc. for $680 million and Google purchased online ad company DoubleClick for $3.1 billion. Looking to strengthen its online advertising services in the wake of those acquisitions, Microsoft also purchased privately held San Francisco-based Internet advertising management firm Rapt in March of this year. WPP May Not Be Only Suitor For Microsoft Ad Agency Some analysts saw a deal between the two online advertising firms as more likely because WPP has been interested in selling or trading its Open AdStream business, according to the report. Microsoft advertiser and publisher solutions group senior vice president Brian McAndrews, who was formerly chief executive of  aQuantive, was seen as being responsible for bringing Avenue A/Razorfish alone when Microsoft purchased the firm. WPP chief executive Sir Martin Sorrell is said to be interested in pushing for a sale or trade with Microsoft. During Microsoft's May launch of Live Search additions for online travel and comparison shopping, Sorrell said the Microsoft program would create incentive for his firm's clients. "Our business is to connect consumers with brands in the most effective and efficient ways. Microsoft’s Live Search cashback creates a real incentive for consumers to connect with our clients," said Sorrell. "We believe this is a major development in the evolution of search marketing and look forward to participating and measuring the results," he added. Sir Martin Sorrell Said To Be Interested In Avenue A In the past Sorrell has also been involved in talks with search leader Google, which he called a "frenemy" in May after the Mountain View, California-based company revealed a partnership with rival advertising giant  Publicis. "Online publishers have a complex array of needs, and they require more attentive and sophisticated partners to help them solve these challenges," McAndrews said in May after Microsoft purchased Rapt. "With this acquisition, we are uniquely positioned to help publishers succeed on all fronts. Our end-to-end solution will include workflow tools, ad package and delivery, turnkey distribution, content partnerships, and yield management and optimization," McAndrews added. Rapt offers applications and consulting services that help Web publishers manage display ads - which typically contain images, video or sound - and control how they are priced and presented online. Founded in 1998 and employing about 85 people, Rapt has several major online firms as clients including both Yahoo and The New York Times Company. Microsoft has not released details of talks surrounding the sale or trade of its Avenue A/Razorfish business, which took in some $345 million in revenue between August 10, 2007 and June 30 of this year. Related Links:
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