Microsoft announced today that it’s working with Spotzer to bring video production capability to small businesses in the Netherlands. This will be part of a broader product under Microsoft’s advertising division that involves a self-service platform for SMBs to create and manage video, display and text ads.

According to the release:

On the basis of a few simple steps they first choose the type of media they want to buy and the extent to which they want to target. Then they can upload an existing ad or, if they don’t have one yet, get a new ad. They may choose ads from a library of professionally produced videos and banners. These can be personalized with branding material or other materials that the advertiser provides. All licensing and creative services are provided by Microsoft Advertising at no additional cost to the advertiser.

The release doesn’t specify points of distribution, but it will presumably involve Microsoft’s own network and its publisher partners. Ads will be placed based on geographic and demographic targeting. SMBs are called out as intended recipients for the new product, having a minimum price tag of 1,000 euros (presumably an annual figure).

This is a good move for Spotzer that will help it get more advertisers. Feeding video into Microsoft’s network could also give it additional distribution for its existing advertisers. In these ways, it’s similar to the deal it formed last fall with MerchantCircle. Like that deal, it also offers a library of preproduced videos to advertisers.

For Microsoft, it brings in better video production capability. This makes it similar to the deal Google recently formed with SpotMixer to bring video production into the Google TV Ads program. This could be a good move as demand grows for online video among SMB advertisers.

Though economic conditions are forcing businesses to reduce ad spending, there is also a fair amount of budget reevaluation. This is causing lots of ad dollars to shift toward more measurable (and less expensive) media. This could bode well for things like search, mobile and online video, and not so well for many forms of already-declining traditional media.

After Brownbook’s announcement, this is the second SMB video product launched in Europe this month. It appears to be currently limited to the Netherlands but could expand geographically over time.