Publicis to Buy Razorfish from Microsoft

Microsoft unloaded a potential conflict of interest today when it agreed to sell Razorfish to Publicis for $530 million.

Microsoft had picked up Razorfish (then known as Avenue A | Razorfish) as part of its 2007 acquisition of aQuantive. That put Microsoft in a position where it was selling ads to itself, and buying ads from its search engine competitors.

Publicis helped Google out of a similar situation last year when it bought Performics from Google. Performics came to Google with the acquisition of DoubleClick.

Razorfish will continue to operate under its brand name and will be part of VivaKi, a Publicis entity that includes Digitas, Starcom MediaVest Group, Denuo, and ZenithOptimedia. Razorfish's management team, including CEO Bob Lord, will remain in place, according to a joint statement issued by Microsoft and Publicis.

The deal includes a 5-year deal where Publicis will get preferred rates on Microsoft's advertising properties, including its Bing search engine, as long as it meets certain ad-buying quotas.