With Google’s USD$3.1 billion buyout of online advertisement company DoubleClick and Microsoft’s recent USD$6 billion acquisition of digital marketing company aQuantive, the world of online advertising is dramatically shifting into high gear.

Both companies are moving rapidly into each others’ turf. Google, being a leader in the online search engine and advertising industry has in recent years, develop and acquire applications to bundle with its services (Google Maps, Picasa…) Microsoft, on the other hand has been a leader in building the entire computer industry around its Windows ecosystem and in recent years, moved a great amount of resources and acquisition to the online search and advertising market dominated by Google and Yahoo. Prior to aQuantive, Microsoft bought a company called Massive Inc for its expertise to insert advertisement into video games. Disruptive forces is happening in the software industry – where a shift away from desktop applications and toward applications / services delivered over the internet.

Ray Ozzie, Chief Software Architect of Microsoft has made it clear the importance of Microsoft focus on ‘Software Plus Service’ paradigm in the recent press conference held. And more recently, they announced that Microsoft Works, a trimmed down version of their office application suite will be provided for free, with ads supported.

From a personal point of view, Microsoft has not been the most innovative company in recent years to be the first to come out with applications / services but if you look at their history of acquisition and focus, you have to be very afraid when they do expand into a different industry all together. Microsoft has the tenacity and flexibility to adjust and align itself to new markets dominated by others and through play safe approach (letting others test and try out the market), and seeing the potential growth of the new market, Microsoft with its billions in cash reserves will make the second / third move. (remember Netscape in the 90s)

Google’s dominance has come primarily from its prowess at making money from ads placed next to Web search results. Google snagged nearly half of all Web searches performed in the United States in June while Yahoo grabbed about 25 percent and 13 percent were on Microsoft’s search sites, according to audience-measurement company comScore.

Some analysts see the search-ads market starting to stagnate and believe Microsoft’s bid for aQuantive, indicates a looming shift in online advertising.

The early online search-ads have really propelled Google’s growth for the past four years and is starting to slow down… according to Gartner Inc. The next wave of growth is going to be big brands shifting their advertising budgets, still largely invested in newspapers and TV, into the Internet.

For a team like Ad.WRIGHT, the shift to online advertisement market is a bonus for us as we aligned ourselves with the bigger players and focus on the technology / partners to provide a complete platform for clients to design, development and extend their online revenue stream through online ads well placed.

Ad.WRIGHT is constantly aligning itself with the market forces / trends and we are confident with our experiences gained over the last 6-7 years of web development, we can be a leader in the online advertising space, providing the creativity, tools for tracking and execution that will tie well with our clients marketing objectives.

Based on a recent data presented by the Online Publishers Association and Nielsen / NetRatings, the percentage of people engaging in content reading is now more than ever before. Based on a four year long Internet Activity Index (IAI), which measures the use of ecommerce, communications, content and search services over time, it was concluded that activities like ecommerce and communications still remain popular, reading and viewing content has skyrocketed between 2003 and today.

According to the data, about 34 percent of Internet users’ time was spent reading content in back in 2003, while content came in second to ‘communications’, which measured a 46 percent of Internet users’ time. Surprisingly, as of May 2007, OPA reports that those numbers have dramatically reversed! Content now came in at 47 percent of Internet users’ time while ‘communications’ came in only 33 percent.

For many businesses out there, this is very important shift of strategy and emphasis on their online media. Not only is the importance placed on good design website but more than anything else, a good quality content site will bring in consistent readers over time. The figures itself only confirms the shift in the behavior of Internet users from communications to content and some of the activities engaging users are like news reading, browsing listings, checking out information on certain products or services…

Adding onto the trend are social networking sites that pushes the content readership to new heights. Under OPA’s metric, social networking are counted as content site and only email are classified as ‘communication’.

However, it seems that e-mail’s popularity isn’t actually going down, but rather the availability of content to consume is going up. Within Ad.WRIGHT, we consume more and more of our everyday lives online than ever before, by researching client information or reading up on the latest technology to help our clients stay on the leading edge (AJAX, Silverlight…)

Many a times, when we meet with clients on web development needs, client would always place a lot of importance on the Branding / Design of the site, but rarely see the importance of putting in a good quality content to substantiate the overall package. We keep emphasizing to the client that getting a good content management system and well design site is not enough, but the support from top management to see the importance of getting a good writer (both internal or external) to write up the content for the site. Some have heeded the advice and are seeing the results of their site readership gone up over time.

With Singapore launching its island wide Internet coverage this December, we will likely continue to see this pattern in the years ahead as people continue to shift their offline activities online and the importance of quality content on online medium is not to be ignored.

A very cool video,

What is the definition of web 2.0?