Microsoft online growth led by gaming, search

October 25, 2007: 12:54 PM ET

Data iconMicrosoft (MSFT) mostly saw modest increases in traffic to its online properties in the third quarter, with gaming, technology, real estate and search leading the company's growth.

The latest numbers from Nielsen Online show that the category for Microsoft's Xbox 360 console, which is battling Nintendo's Wii and Sony's (SNE) PlayStation 3, was the fastest-growing online property for Microsoft compared to a year ago. Most important for the company though, its search business ranked in the top-five fastest-growing categories, a trend that will help Microsoft better compete with the likes of Google (GOOG) and Yahoo (YHOO) for online advertising.

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Overall online traffic increases were small, however. Traffic to the Microsoft parent company increased three percent year over year, from a three-month average monthly audience of 115.9 million unique visitors in Q3 2006 to 119.1 million unique visitors in Q3 2007.

Microsoft's Top 5 Fastest Growing Channels (3-Month Average Monthly Unique

Audience)

+-------------------------+---

-------+----------+--------------+
| Channel                 |  Q3 2006 |  Q3 2007 | Q3-Q3 Growth |
|                         | UA (000) | UA (000) |              |
+-------------------------+----------+----------+--------------+
| XBOX                    |    1,116 |    1,724 |          55% |
| MSN Tech & Gadgets      |    1,626 |    2,215 |          36% |
| MSN Astrology           |    1,110 |    1,457 |          31% |
| MSN Real Estate         |    2,941 |    3,805 |          29% |
| MSN/Windows Live Search |   39,856 |   51,525 |          29% |
+-------------------------+----------+----------+--------------+
Source: Nielsen Online, NetView
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