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Is Microsoft Looksmart's "New High Quality Distribution Partner" ?


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Oerhomenos had replied to a poster on Yahoo's LOOK board & wrote ..

"if its MSN/YHOO, yes of course it wont be at $12 ............ It will be at USD 40-45! - But chance of it being them is not huge"

I agree with his share-price assessment but I'm more than confident that Microsoft are the new partner that are currently being (so-called by Looksmart) 'integrated', into the Looksmart AdCenter Marketplace.
By now readers will have realised that I am adament that (both) Microsoft and Newscorp have combined their resourses (technology & man-power) to build Looksmart's AdCenter.

With the capability that allows it to (with private-labeled use of the API connector) get to have the likes of Microsoft, Yahoo, Google etc ...to ALL then buy and sell Ads within the Looksmart global marketplace. And to (all) compete on equal terms or, on that basis of being 100% "blind" to each other. (In their all having no prior data 'info' or, access to other's prices etc- in that 'real time bidding' marketplace).
I'm also assuming that Microsoft are (or, have been) getting a steady 'return' on their AdCenter investment (up front) in that they have been using the technology for quite some time now, with their Atlas Solutions & via or, through some of the many platforms (like OpenX), that have sprung up over the past couple of years. And (whist being 'paid back', have been running their 'own' marketplace (or, with/through the likes of Accipiter) albeit, that it is one that is or, cannot be seen to be, fully transparent .

seekingalpha.com/user/36191/instablog/se...

Microsoft
(and, it's possible?) may well have been, being 'paid back' over the past few years within Looksmart's many quarterly 'entries' that are shown as being for, 'Capital expenditure'. (eg; from Q3 - 2008 Report, here) 

< ...Capital expenditures, including capitalization of internally developed software, in the third quarter of 2008 remained constant from the prior quarter at $1.2 million, and increased $0.7 million from $0.5 million in the third quarter of 2007>

Newscorp (itself, I feel) will get their own return (in time and certainly over time to come), from a 'controlling stake', buy-in of Looksmart, ok? I wrote along these lines in my last SeekingAlpha InstaBlog post:  
 
<....I have the feeling that until the marketplace is fully operational, Microsoft is (and rightly so), enjoying the full 'fruits of it's investments', through it's Atlas Solutions The Looksmart independent Adcenter (in time), then takes it all to a final ('one-stop-shop') step where Atlas will itself become just one of many (equal to all), that will get to operate within the Looksmart marketplace. (An opinion.) > 
Some 'proof' of this (most probably) happening is contained in the past two Looksmart 10-Q's and is hilighted by the 'disappearing' UK (the previous International) revenues that have once again, suddenly re-appeared. (Bearing in mind that Looksmart had once boasted of it's growing revenues outside of the US. - International Traffic Growth Contributes 14.7 Percent of LookSmart's Revenue in Q2 2008 - 08/06/08)
Q4 - 2009 10-Q
Revenue Concentrations
The following table reflects countries that accounted for more than 10% of net revenue:
                         
     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2009     2008     2009     2008  
United States
   86   85   87   87
Canada
   11   10   10                   **   
 
**     Less than 10%
**************************
Q1 - 2010 10-Q
Revenue Concentrations
The following table reflects countries that accounted for more than 10% of net revenue:
             
       Three Months Ended March 31,  
     2010     2009  
United States
   64   86
Canada
   14   10
United Kingdom
   10   *
 
**Less than 10%
   
**********************
This strong 'theory' is covered from 'all angles' by Looksmart, in a small sentence that's shown here:
10-Q - (Bottom of page 28) - "The AdCenter is used to operate both our own Advertiser Network and other publishers’ client networks, and is licensed to publishers to operate their own network."
MICROSOFT (outside of it's own Atlas Solutions Ad platform - and with it's 'clone' of the Looksmart AdCenter, ad serving tech - and marketplace - Accipiter), are or, WILL mostly finish up purely as a publisher platform (looking after it's own and Yahoo's over 100 quality sites - plus many newspaper/magazines sites), that will mostly all get to sell Ads through the Microsoft AdECN Exchange. IMHO.
Yahoo (on the other hand), will be 'buying" in Ads through it's Right Media Exchange and for or, on ALL of those above-mentioned sites, for starters. They will certainly have that important need to be 'separated' within the Looksmart marketplace. Separate from each other (for sure), and with no direct access to each other's data, in 'real time'.
Both their Exchanges will operate under RTB (real time bidding), conditions. Publishers will (as they do now), still be selling their Premium pages (sites) directly to Ad buyers on a one-on-one basis. There is little to no revenues here, for Looksmart. (Media buyers will simply nominate certain sites they want to be on, and buy directly, accordingly).
The 'roocka' Yahoo post (Consumer Watchdog targets Google - and yet another, and, an as was 'predicted', BAKE for Google), that  simply hilights that (at this stage) Google are dominating because it's DoubleClick Exchange is doing almost all the banner advertising business. (At least 65% it seems, already). And I'd also say that (Google), is already within reach of Looksmart's own marketplace. (Or, rather, more-so, that Looksmart are operating within the Google DoubleClick Exchange marketplace). 

 [ Check ClickStream, here: http://www.alexa.com/siteinfo/Looksmart.com ]
But when Microsoft/Yahoo and the newspapers are fully 'on board', suddenly there is much more (and easier to buy) inventory that becomes available (many more publisher sites) and plenty more buyers attracted to it, over-all. Looksmart don't get to handle all of this, far from it.

What Looksmart will see is (both) inventory that needs to be filled - (Ads sold) and buyers of those Ads on that 'remnant' (or, back-fill - last chance Ad buys), basis. Those cheaper blind, 'bulk buys' for all (any), directly unsold inventory. (Better an Ad than none, kind of...)
Yet it's that "International" visitor from across the web (with ad revenues then being generated at all times for publishers), that makes it (realistically), a "more for less" value proposition, that will prove most popular from both the sell and buy sides, I feel.
Being "bulk" (or, again, "blind") buys & a 'one-stop-push of the button' (for media buyers/brands) across the total marketplace, with AdCenter still providing them with user 'targeting' and (at a lower auction based cost at scale), in return, they get a standardised one 'brand' (only) of analytics with a 'one fits all' set of data. (From Looksmart), 

Whereby they are then players in this 'secondary marketplace' business, on level terms. With both buyers & sellers using the Looksmart "private-label" (API advertiser - publisher connector) and through the Looksmart Adcenter platform, separating them from each other, giving them all a fair and 'equal chance'.  (In value and cost for buyers or, it's true 'worth' for publisher sellers.)
To operate in that one big (wholesale, secondary, remnant Ads) marketplace and one, that is providing a single action 'blind auction' (atmosphere), being (equal to all), at all times.
That all amounts (or, adds up) to billions of those kind of impressions (or, 'queries') daily, all managed through Looksmart's AdCenter.

LOOK: 3:59PM EDT: $1.52  Up 0.07 (+4.83%)

LC

Disclosure: Long LOOK and happy to be so