Gawker: valleywag, circuit city

Microsoft hopes you'll make friends through its new banner ads

Nicholas Carlson — Fri, 08 Aug 2008 12:40:00 EDT

Microsoft-owned ad agency Avenue A/Razorfish has a new product out that's supposed to solve the problem of how easily Web users ignore banner ads. AdLife ads run at the size of a regular banner, but include social features like customer reviews, a feedback button, and of course, user-generated content. AdLife is going through a three-month test right now with publishers WashingtonPost.com, USAToday.com and CircuitCity.com participating. If all goes well and clickthroughs pick up, expect Microsoft to push the product on any agency hoping to advertise on its network. As Avenue A/Razorfish exec Shiv Singh naively put it to AdWeek: "It would be unfair in the long term for it to be totally closed." Singh's title: "global social media lead," which tells us everything we need to know.

Microsoft starts selling Office subscriptions through Circuit City

Nicholas Carlson — Wed, 02 Jul 2008 12:00:00 EDT

Microsoft can't convince customers that they need the new version of Office anymore, so they'e begun to sell it as software-as-a-service, bundled with security software. "Security is basically the No. 1 thing that gets attached with a PC," said Microsoft group product manager Bryson Gordon. The product, code-named "Albany" and now known as Equipt, will cost PC buyers an extra $20 a year over the $49 per year price Microsoft charges for its OneCare antivirus software. Why don't they just let users download the software? That might seem easier, but retailers like Circuit City move a lot of Xboxes and Windows PCs, and the software giant can't afford to leave them grounded as computing moves to the cloud.

Blockbuster's Apple envy

Owen Thomas — Mon, 14 Apr 2008 11:40:00 EDT

The video-rental store is doomed, and even Blockbuster has figured that much out. That's why CEO Jim Keyes is trying to buy Circuit City for more than $1 billion? Blockbuster has become the RadioShack of its time, saddled with too many stores which are too small, selling the wrong thing. It jumped on the business of selling DVDs, instead of renting them, right as disc sales peaked and started to drop. Now, it hopes to sell, via Circuit City's larger outlets, subscriptions to its online video services alongside the devices used to play them. The vision is inspired by Apple, which sells iPods, Apple TV set-tops, and music and video through iTunes. Apple's iTunes movie rentals are a direct threat to Blockbuster's remaining rental business, and Apple is rumored, too, to be getting into the business of music subscriptions. One small problem: It's not clear how Circuit City helps Blockbuster.

Joseph Weisenthal at PaidContent deftly pinpoints the hole in Keyes's theory: Circuit City has already tried selling media subscriptions at the checkout before, with Napster, and it hasn't worked. Retail is a ruthlessly competitive business, one at which neither Blockbuster nor Circuit City has shown particular skill. Wal-Mart, Best Buy, and Target will easily scoop up this combination's customers while it tries to make a poorly thought-out strategy work. Wall Street recognizes that much, which is why Blockbuster's shares are sinking. When will Keyes, who has quietly pursued this merger since December, and is just now taking the effort public, get the message? (Photo by David Pellerin/AP)