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Could be interesting, and go one of two ways.
On one, it could backfire on Digg. Digg is popular with Apple, Linux and those sorts of companies. The only thing worse than dealing with Microsoft in my eyes would be if Digg signed a contract with the RIAA. If the Digg readers don't like it, they will let you know about it.
On the other, it could establish Microsoft as a decent alternative to adsense. You hear a lot of stories of Google banning adsense accounts for little or know reason, and being tricky to reinstate. If Microsoft comes up with an alternative that is more clear in terms of what you can and cannot do, then maybe people will be more inclined to switch.
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