Based on a recent press release issued by the company, Microsoft has sold its advertising division Bing to AOL on June 29th. The decision was adopted as a means of strengthening the position of the company on the market.
While the tech giant is still a strong competitor among software developers, Microsoft has, nevertheless lost approximately $10 billion in the past five years; therefore, the company is now making various changes to strengthen its position.
The software company announced on June 29 that its creative department of Bing will be handed over to AOL for a period of ten years. The online service was developed as an alternative to Google’s search services. Bing also included advertising options content and consumer services; therefore AOL believes the deal will be incredibly profitable for them.
Based on the terms of the deal, AOL is entitled to advertise on Microsoft’s main products, namely, Skype, MSN, Outlook and Xbox. This advertising option is available only for countries like US, Canada, Japan, Brazil, as well as some European countries, including UK.
Neither Microsoft, nor AOL have disclosed the financial terms of the deal. AOL has, nevertheless, stated that Bing will begin making profit next year after their advertisements will be enacted.
The major downside of the deal is, according to market analysts that more than 1,200 workers at Bing will have to move to AOL for the following period and get accustomed to their new working environment. Even though AOL reassured the public that no worker will be fired as a result of the new purchase, Bing employees are afraid they could soon lose their jobs.
Microsoft is making constant efforts to regain its leading position on the U.S. technological market. The company has previously focused on the field of personal computers and is now looking at new possibilities of integrating cloud and enterprise services in their portfolio.
The two companies have concluded their online declaration by saying that the advertising department of Bing service will be integrated into AOL starting on January 1st, next year.
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