Would M$ buy an adware firm?

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Microsoft

The move, assuming there's an ounce of truth in it, would give Microsoft two things. First, a $100m-a-year advertising business that leverages adware installed on 40 million desktops. Second, the public relations headache from hell.

The New York Times broke the story yesterday, citing sources who had "been briefed on the plans" and sources "close to Microsoft" who possessed quite granular levels of detail about the talks, said to be in their second week.

The companies in question are not commenting for the time being.

Often, when stories such as this are leaked to the major papers, it is because negotiations have hit a sticking point, or the companies in question want to test public reaction before signing off on a deal.

Indeed, the NYT reports that there are some internal battles at Microsoft, reaching all the way to the top, over whether buying Claria, the most notorious adware company out there, would be a wise move, and that talks have stalled as a result.

But many observers think the very idea of such a deal would create yet another serious conflict of interest at Microsoft, which last December acquired anti-spyware software maker Giant Software.

It's possible that Microsoft is interested in BehaviorLink as a way to boost its MSN property's ability to compete with Google Inc and Yahoo! Inc, both of which operate their own ad networks.

Many said that Microsoft's acquisition of Giant and its acquisitions of anti-virus software makers presented a conflict of interest, as buggy Microsoft software is one way that such threats propagate.

But when those acquisitions were revealed, nobody could accuse the company of developing viruses or spyware. Acquiring Claria, which makes software still detected as spyware by some programs, would change that.

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