Microsoft Calling Windows Phone 7 An “Ad-Serving Machine”

Microsoft obviously has high hopes for its fledgling mobile business, and mobile advertising may be the answer, according to Microsoft executives.

The company’s upcoming Windows Phone 7 OS has been heavily-tailored for user-experience and, more importantly, serving mobile advertisements.  Speaking at the Cannes Lions International Advertising Festival, Microsoft general manager for strategy and business development Kostas Mallios said Windows Phone 7 applications will enable advertisers to push offers and news directly to handsets across a new marketing platform dubbed Toast, adding that even when a given app is inactive, a small ad box can slide down from the top of the device screen to notify the user of a new promotion.

Microsoft will likely utilize the dynamically updated “live tiles” on the Start screen of new Windows Phone 7 devices to mingle real-time content and information together with sponsored content.  Mallios said advertisers can leverage the tiles to deliver promotions directly to users’ homescreens: “What you’ll see is that there’s actually a message on that tile,” he explained during a demonstration.  “So that tile is actually a dynamic tile that you’re now able to push information to as an advertiser, and stay in touch with your customer.   It’s a dynamic relationship that is created and provides for an ongoing dialog with the consumer.”

Microsoft will have to tread lightly here, given its track record with mobile consumers in the past, and not to mention its extraordinary competition in the device, mobile OS and mobile advertising spaces.  “(Windows Phone 7 is) an extra move on our (natural user interface). We’re trying to get technology out of the way of people,” Mallios explained. “For consumers, what this means is basically seamless experiences, seamless social connectivity–not just about applications, obviously about the phone, obviously about media… It basically enables advertisers to connect with consumers over time.”