Confusion Over Microsoft Ad Exchange Strategy As It Shutters Hosted System. What Is The Next Move For Microsoft?

In a bizarre announcement to clients yesterday, Microsoft announced it was closing its ad exchange. The communication referred all existing customers to John Ebbert’s Adexchanger.com for alternative vendors. CPM Advisors' CEO Rob Leathern published the email in full on his company’s blog:

Dear AdECN Member,

Thank you for your use of AdECN’s services and participation on the Hosted system of the AdECN Exchange for the last few years. We regret to inform you that AdECN has made the difficult decision to close the Hosted system in accordance with following timeline:

- February 15, 2010 will be the final day that ads will be served. This closure will include all ad-serving, any default code, and all other AdECN services.
- However, we will continue to provide UI access until March 15, 2010, after which point there will no longer be any login access to the AdECN Exchange. You will not be able to access the AdECN Exchange, including any data you have stored on the system, after March 15.
- All balances will be paid in full by March 31, 2010.

We are committed to working with you to make this closure as painless as possible. Please contact support@adecn.com to tell us how we can assist you in transitioning your business. Contact support@adecn.com or your Account Manager by January 15 if there are major issues with the February 15 date to discuss how we can make this transition off the Hosted system as amenable as possible.

We will only be able to provide redirect services to third party ad exchanges or servers through February 15, 2010. Billing and serving data will be available via the UI until March 15; on request we can also provide you with copies of the last 9 months’ billing invoices (provided we receive your request prior to February 15).
You may also want to review a list of alternative ad exchanges and infrastructure providers here.
We thank you again for your participation on the AdECN Exchange.

Sincerely,

AdECN Team

After the story broke yesterday, Microsoft was quick to clarify that they were only shuttering a “legacy product” and would be concentrating on RTB. Microsoft has been very reticent on their exchange strategy, and in Europe they have said little about what they’re planning to do.

I have heard many industry people talk about how Microsoft will ultimately play a big role in the exchange space, but I’ve seen precious little activity on that front.

Maybe it’s just waiting to buy Yahoo outright. It could then throw its considerable corporate weight and resource behind the Right Media exchange. Add Ad.com and AOL into the mix and it could have an ad exchange fit to rival any Google platform.

Or maybe it is going to forgo the ad exchange platform all together and enter the DSP business. It’s still got a considerable cash pile to buy a ready-made one outright. But nobody is talking at Microsoft – and judging by yesterday's email there also seems to be some confusion about what the company’s next move will be in the exchange space. What's going on? Seriously.