Microsoft teams up with the cool kids
'Willy Gates' and his software empire are trying to shed a stale image and lure coveted content partners.
By Nadira A. Hira, FORTUNE writer-reporter

NEW YORK (FORTUNE) - When Microsoft takes over the Rockefeller Plaza observation deck Wednesday afternoon, it won't be to host a tech talk. It's to get the bright lights of media and entertainment - Bonnie Fuller, Benny Medina, BBDO Worldwide CEO Andrew Robertson - together for "a stimulating conversation about triangulating the sweet spot of pop culture, technology, and brand," according to the invite.

Didn't see that coming? It might seem a little strange for the software giant to be hosting such a symposium, but it's actually part of a much bigger trend at Microsoft (Research).

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Everyone's heard the big news about the company: Advertising! Partnerships! Branded entertainment! It's great, and it's about time. But what no one's caught onto is just how completely unexpected - and yes, maybe even cool - those new partners are, from Def Jam President Shawn "Jay-Z" Carter and NBA superstar LeBron James to those pretty politicos the Dixie Chicks and the ever trendy MTV.

As it turns out, in a play to drive traffic to MSN, attract advertisers and one imagines, eventually outmaneuver Google (Research) and Yahoo (Research), the erstwhile geeks are teaming up with the popular kids.

It's a bit of a shift for a company that - however innovative - has often had an inexplicably stale image. We've all seen the commercials: Mac Guy, a shaggy, funny hip-looking dude suffers through hilarious exchanges with PC Guy, a bespectacled middle-aged character straight out of Office Space.

But as Apple (Research) has continuously tried to force Microsoft into the uncool corner, the old beast has retaliated with a flanking attack. Instead of trying to hippify itself, it's reacting to the increasing demand from marketers for technology-based outlets for brand-building - through its new Windows Live products - and leveraging its ability to lure all sorts of coveted content partners to create those marketing opportunities.

"We're not Hollywood," says Joanne Bradford, Microsoft's chief media revenue officer, "but we know we have to play in Hollywood, so we're trying to be very humble and thoughtful about it. We're placing a lot of bets, but so far it's looking good."

And the results span quite a range. There are obvious high-profile deals, like Microsoft's purchase of in-video-game advertising company Massive, or the launch of a new iTunes-like download service called Urge with MTV.

But others are a bit more surprising. The Dixie Chicks are toting an embedded MSN writer on their tour to produce articles and video for the site, and the band premiered their new album on MSN. And at the recent Strategic Accounting Summit in Seattle, Microsoft announced plans for ten Web pilots for MSN from Reveille, the independent production company behind shows like NBC's The Office and The Biggest Loser.

"In television, one half-hour show can define a whole network," says Reveille founder Ben Silverman. "Microsoft really woke up to that, and said, 'Hey, Windows' brand is cooler than Microsoft's. Why don't we apply that to our content strategy, instead of trying to do it ourselves?' That way, they are as powerful as the individual brands on their distribution platform."

Even more off the beaten path, Windows Live is sponsoring LeBron James's "King for Kids Bike-A-Thon" in Akron, Ohio on June 24, offering virtual tours of the route on the Web.

"What they bring to us is the ability to reach tremendous numbers of Internet users around the world," says Maverick Carter, of LRMR Marketing & Branding, where James is both an owner and a client. "And LeBron brings a breath of fresh air - along with all the people who follow him and do everything he does - to MSN."

Carter predicts further collaborations, and it'll be interesting to see how they shape up. At the Seattle conference, CNBC's Donny Deutsch interviewed Bill Gates, and followed with none other than rapper-turned-exec Jay-Z, another partner with whom as-yet-unannounced plans are being made. Back in New York, at an MSN-sponsored dinner to celebrate the fall lines of his Rocawear clothing and S.Carter sneaker, the crowd featured artists, industry-types and more than a few Microsoft techies.

When Jay-Z lifted a glass to toast his new friend "Willy Gates," despite a few amused cringes, one got the sense Microsoft might be onto a whole new kind of innovation. And this time, it's social. Top of page

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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.