Microsoft is reportedly in talks with advertising giant WPP to trade its digital ad agency Avenue A/Razorfish for the ad-serving technology WPP acquired when it bought 24/7 Real Media deal.

A report in Ad Age said discussions between the two companies had reopened and that the digital ad agency network could be valued at about $800m.

Microsoft acquired the digital agency network in May last year in its $5.9bn deal to buy aQuantive, a deal that followed Google's $3.1bn acquisition of DoubleClick.

Analysts argue that Avenue A/Razorfish is superfluous to Microsoft's needs. However, the premium the technology giant paid to secure aQuantive means that the price that Microsoft needs to sell the digital agency network is sky high.

Microsoft's ambition to crack the online display ad serving market fits well with WPP's desire to offload the Open AdStream ad serving tool, which publishers use to display adverts on websites. WPP picked up the technology as part of its $649m purchase of 24/7 Real Media.

WPP's acquisition included a search engine marketing business and an advertising network. The Open AdStream ad-serving tool for web publishers is not essential to WPP's digital advertising ambitions.

The report suggests that WPP would also have to offer cash on top of the asset swap of Open Adstream.

The ad-serving technology would help to bolster Microsoft's ambition to tap into a global online advertising market worth about $40bn (£20.2bn), particularly after it failed to secure a deal with Yahoo.

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