Microsoft's TabletPC opens new ad horizons

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Microsoft Corp. is in discussions with executives at a handful of major publishing companies to make content-and advertising-from their publications available on its highly anticipated TabletPC.

Launching in November, the TabletPC is a notebook PC with a flip-back screen that converts pen strokes into graphics. The product is a major priority for Microsoft that Chairman Bill Gates has touted for more than two years at technology trade shows. He showed it off this spring to 100 chief executives at his Medina, Wash., home.

The potential for advertisers could be enormous. Connected to the Internet while reading an article on a TabletPC, a consumer could use the product's stylus to tap on an ad for say, Skyy Vodka, and be directed to the marketer's Web site, or the ad might morph into full-motion video.

"With this device you have the opportunity for a whole new presentation of advertising-it's a print ad, a direct response ad, a full-motion video, a broadband wireless ad," said Mark Stewart, exec VP-director of strategy and channel planning at Interpublic Group of Cos.' Universal McCann, New York. "We have a bunch of clients that are always interested in getting early learning on new technologies." Mr. Stewart said he is evaluating the TabletPC's potential for his clients, although he wouldn't identify which ones.

Among Universal McCann's clients are Microsoft, Coca-Cola Co., Sony Electronics, Sony Music and Labatt USA.

Microsoft declined to make an executive available to discuss its plans for content on the TabletPC and through a spokesman said that no partnerships have been announced.

talks with `forbes,' `wsj'

But the company has held talks with Forbes, Dow Jones & Co.'s Wall Street Journal and Conde Nast's New Yorker to make content from each of the publications available on the TabletPC. "We're looking at it," said Jim Spanfeller, president-CEO, "I think the advertising community will be interested, but there won't be a lot of scale at first."

Calls to Miguel Forbes, VP-development at Forbes who is coordinating the discussions with Microsoft, were not returned. A Wall Street Journal Online executive declined to comment but indicated that talks continue mostly over implementation and presentation.

The New York Times Co. is believed to be a fourth publisher participating in the venture, but a spokeswoman said the company is "not currently in a relationship" with the software giant to place content on the TabletPC. "We don't comment on potential partnerships, only signed partnerships," said spokeswoman Christine Mohan.

The New Yorker will introduce a TabletPC prototype with content from the magazine at its annual festival in New York starting Sept. 27 (AA, Aug. 19). "We see the use of technology to enhance the reading experience and wanted to get in on the ground floor," said David Carey, VP-publisher. "It's a natural for us."

Mr. Carey said The New Yorker will work with a handful of unidentified advertisers to participate in the magazine's launch on TabletPC.

The publications involved are in the process of determining whether they will repurpose content from digital and/or print editions. Subscriptions or articles from magazines and newspapers can be downloaded from the Web for access. It has not been determined if subscribers would pay for content, but e-subscriptions, pay access to publications' archived articles and advertising via the TabletPC could become a source of ad revenue for publishers.

"I think that an advertiser's concern is understanding what the efficacy and the presentation of the advertising content is," said Universal McCann's Mr. Stewart.

Brad Brinegar, president-CEO of Havas' McKinney & Silver, Raleigh, N.C., whose clients include Nasdaq and Audi of America, has sampled the product and is enthusiastic about it. But he believes some basic questions need to be answered. "What's it going to cost us and our clients to take advantage of this? And the biggest issue: Can you provide content that people want to read?"

Microsoft plans to back the TabletPC with a multimillion dollar ad push created by Interpublic's McCann-Erickson Worldwide, San Francisco. The product will also get support from partners that are building it, including Dell Computer Corp. and Hewlett-Packard Co.

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