Microsoft is reportedly looking to sell its online advertising agency Razorfish just two years after acquiring it as part of a $6bn deal for parent company aQuantive Inc. A report in the Financial Times suggested that Microsoft has brought in the investment bank Morgan Stanley to seek out a potential buyer for the agency, which has been valued between $600 million and $700 million. There has been some speculation about whether or not Microsoft would part with Razorfish as part of its new strategy to trim back expenses and restrict its actions to core business needs through the recession.
When Microsoft made the decision to purchase aQuantive in 2007 its main purpose was to create a stronger online advertisng network for the brand and be in a better position to compete with Google in online advertising. The benefits of owning Avenue A/Razorfish, as the agency was then called, were secondary to other aspects of what aQuantive could offer Microsoft as much as it would allow the company to significantly broaden its online ad network and place it in a far better position to compete with search engine giant Google. Acquiring an advertising agency, though, left Microsoft with a possible conflict of interest as Razorfish would be competing directly with the companys own advertising efforts to market the brand and its products on the web.
Razorfish has produced successful online advertising campaigns for a number of big clients such as Nike, Mercedes-Benz USA, Levi-Strauss & Co and Audi. The amount of money involved might not seem much to Microsoft, but the decision to sell could enable Microsoft to put more emphasis on marketing their own products across different media. According to the Financial Times the French company Publicis Groupe are the most likely contender to buy Razorfish, following rumours that Publicis and Microsoft are planning to join forces for a TV ad campaign in the near future.
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