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Business Impact

Microsoft signs Web video deals with Volvo, Chivas Brothers

SEATTLE (AP) – Microsoft Corp. has signed deals with Volvo Car Corp. and whisky maker Chivas Brothers Ltd. to support two new Web-only video series from Reveille, the production company behind TV shows ”The Office” and ”Ugly Betty.”

The two new shows – ”Driving School,” a comedy about a driving instructor who imparts life lessons to his students, and ”This is the Life,” a travel and adventure show linked to a Chivas Regal advertising campaign – will arrive on Microsoft’s MSN Web site in the next six months, the software maker announced Tuesday at an advertising industry conference here.

Microsoft would not give details about financial or product-placement arrangements with and Chivas Regal and Volvo, part of Ford Motor Co.

After Google Inc. made online video a white-hot topic with its late 2006 acquisition of YouTube, advertisers and ad brokers scrambled to turn the trend into dollars with the Web equivalent of TV commercials – short spots before or after a video clip online.

Those will remain a staple of Microsoft’s video advertising inventory, said Gayle Troberman, general manager of branded entertainment at Microsoft.

But advertisers are also experimenting with original series and user-generated videos as they seek even deeper connections with customers online.

In the past year, Microsoft and Reveille produced a handful of MSN shows that fall somewhere between advertising and programming. Troberman touted Kraft Foods Inc.-sponsored ”Chef to the Rescue” as one success story to emerge from the Reveille partnership. Microsoft said after the cooking show’s December launch, more than 250,000 viewers also printed out related recipes featuring Kraft products.

Microsoft faces increasing competition in online video. MSN video is now the sixth-place video destination in the U.S., lagging YouTube and sites from Google, Time Warner Inc.’s AOL, News Corp.’s MySpace and Yahoo Inc. In April, 11.5 million people visited MSN video, and spent an average of five and a half minutes on the site, compared with 45 million people who each spent nearly 41 minutes on YouTube, according to Nielsen/NetRatings.

While it’s tempting to label the shows advertorials and leave it at that, Ben Silverman, Reveille’s chief executive, said he’s tried to find more elegant ways to incorporate products and entertainment.

”I don’t want to be in something where you’re ruining that content by stupid, clunky choices,” said Silverman.

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On the Net:

http://video.msn.com

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