Kara Swisher

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Microsoft on the Hunt for a New Head of World-Wide Online Sales, Even as Yahoo Talks Continue

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Microsoft is searching for a major executive to run its world-wide online sales, said several sources close to the situation, even as talks with Yahoo about a deal to partner in its search and display advertising businesses continue.

“They need to find a way to make money in display,” said one source close to the situation. “Or, I guess, find a way to not lose quite so much.”

The software giant has been trying to build its online business for many years now, spending a lot of money and not getting very much traction.

In its recent quarterly results, in fact, Microsoft’s online services got hit badly, with a 14 percent decline in revenue from a year ago to $721 million. Losses doubled to $575 million.

Sources said Microsoft (MSFT)–which has hired headhunting firm Spencer Stuart to conduct the search–is looking for more execs to turbocharge the situation, with one criterion being that the person hired is “another ambassador to Madison Avenue.”

Last fall, it did that by hiring Time Inc. ad exec Robin Domeniconi to take over as the new VP, U.S., Microsoft Advertising.

That’s why the new sales candidate the company is looking for might only be for someone to lead Microsoft’s international ad sales, since the exec in charge of that business left in December as part of a mass of changes in the wake of the hiring of digital head Qi Lu.

Those changes included the departure of that exec, Global VP of Sales Bill Shaughnessy, as well as its top online ad sales exec, Brian McAndrews, and the rejiggering of its online sales unit.

In that switch, Microsoft said in a press release: “The field sales organizations in the Online Services Group will move to Microsoft’s centralized Sales, Marketing and Services Group led by chief operating officer Kevin Turner. This group, called Consumer & Online, will be led by Corporate Vice President Darren Huston and will include the Global Advertising Sales and Services organization, led by vice president Bill Shaughnessy.”

The move to centralize, according to sources, has been controversial within the company, since it means all sales are being lumped into one megagroup.

That could all change dramatically again if there is any success in the talks Microsoft has been having with Yahoo (YHOO) about outsourcing its online display sales to the Internet giant. The pair have been discussing partnering over search and advertising.

While such a deal might not happen–Yahoo has been especially reticent to separate its search and display businesses–the two sides have been discussing several scenarios in a bid to compete with online giant Google (GOOG).

Among the latest ideas is one in which Yahoo would take over both search and display advertising sales and Microsoft would run the tech behind the scenes.

Such a deal would be a major shift for both companies in their business focus and would also tether them together.


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