Two rival internet companies recently collaborated for a great new project. AOL, Inc. (NYSE:AOL) and Microsoft Corporation (NASDAQ:MSFT) agreed on a deal that would allow Microsoft to distribute AOL videos on some of the site’s properties.
Microsoft and AOL made lucrative deal
This new deal will enable Microsoft Corporation (NASDAQ:MSFT) to access all of AOL, Inc. (NYSE:AOL)’s video collection. This includes video clips from HuffPost Live, TMZ, ESPN, and TechCrunch. Microsoft will run these videos on the MSN website and Bing apps running on Windows-based phones. The company will also sell most of advertisements for the videos and split ad revenue with AOL.
This isn’t the first time AOL made a deal for the video distribution. The internet giant scored a deal with YouTube over a year ago. This deal allowed AOL, Inc. (NYSE:AOL) to distribute videos through 22 channels including Moviefone, TechCrunch, and HuffPost Live. YouTube offered internet real estate and revenue sharing. This allowed YouTube to access AOL videos and sells YouTube’s inventory.
AOL believes new deal is promising
Some AOL, Inc. (NYSE:AOL) officials believe this move is key and that Microsoft Corporation (NASDAQ:MSFT) has a strong desire for more premium content which is something AOL delivers. Microsoft’s television and video advertising business executive Scott Ferris claims the company is still committed to producing original videos. And next Monday, the company will show their own videos to ad buyers.
AOL Video’s president Ran Harnevo elaborated, “Microsoft’s suite of devices and services is unmatched, and its loyal audiences are constantly seeking new and refreshed offerings on their platforms. We have an open strategy for distributing our premium content, and we’re proud to partner with Microsoft Corporation (NASDAQ:MSFT) to enhance their video experience. As anyone who watches the online video space knows, AOL has seen tremendous audience growth over the last few years — views for our content are up nearly 75% in the last year alone — and the sheer scale of Microsoft’s network will help us reach a massive new audience and continue our climb.”
This sounds like a winning deal for both parties.