Microsoft announced today that it is launching its own pay-per-click ad network, according to the New York Times.
Pay-per-click advertising has been the highest growing area of online advertising, which has been the highest growing area of overall advertising in the past year. Tight inventory, among other things, has boosted pay-per-click costs, and a new MSN ad network will be a welcome addition.
Microsoft's demographically targeted ad serving model will be new in the industry. Demographic information gathered from Hotmail and Passport subscribers will allow ad targeted not previously available.
The example provided by a New York Times article is a search for the keyword "roses." Though other networks would serve ads based on their bids only, the MSN network might serve florist ads for men and garden supply stores for women.
Advertiser tip: generally getting on board right at launch can get you in the door with less expensive bid costs and an opportunity to evaluate performance of the system for your own business.
It remains to be seen if this will hold true in such a hot ad market, but the first to play can gain advantages on competitors and evaluate best ad opportunities.