Google versus Microsoft for Doubleclick
Today, 11th of March, 2008 is a very important day for Google as it finalized the acquisition of Doubleclick.
Google’s core revenue is AdWords, that’s a known fact for almost everybody who ever saw those tiny text ads all over the internet. Those classifieds are coming from AdWords users who want to increase their sells or drive more traffic to their websites by cheap either Cost-per-Click (CPC) or Cost-per-(thousand) Impressions advertising. But so far these advertisers were limited to those tiny very limited classifieds. There are other types of advertising possibilities as well for the AdWords users like Click-to-Play video ads or image ads, but if they, the advertisers has no artistic skills they have to hire an advertising agency to create them, and these agencies’ work costs a small fortune.
And let’s not forget that those small classifieds created by AdWords users, like the one below this post, aren’t too pretty. Let’s be honest, they aren’t stylish at all. But these small ads made Google so powerful, that nowadays is one of the hugest companies, let’s say ruling the Internet. They enabled for Google to grow to an unimaginable size in relatively no time. First those ads appeared only in the Google search results, later they enabled for practically everybody to place them on their web pages after signing up to a service named AdSense. The AdSense engine has it’s own content crawler, working independently from the other GoogleBot’s. This AdSense Crawler makes that usually the ads displayed on the websites matches the content so relevantly, that the reader actually finds the ads interesting.
But these services were not enough. The Google Staff recognized that there will be a declination when webmasters won’t find the google-services interesting for their business, they won’t publish AdSense ads on their websites nor will advertise with AdWords. In addition, Yahoo!’s Search Marketing service, which basically is the same as AdWords, became a rival of Google’s advertising program. So they had to move forward by improving their services or create brand new ones.
Creating a new service is a slow process, it consumes a lot of energy, precious time but most importantly: money. It’s a common practice amongst the mammoth firms that they buy an other well running firm to widen their service and to offer more for the users, or just to target a new audience. this happened in Google’s case as well: probably because the above mentioned reasons they payed 3.1 billion US Dollars for Doubleclick. Yes, you’ve read well: 3.1 billion US Dollars.
Two weeks ago the offer was “only” $2 billion, but maybe because Microsoft also was in competition for Doubleclick, Google had to increase its bid. As always, Google can’t loose. And in this case it’s something normal. Google’s core revenue is selling ad-space in the search results page and the above mentioned AdWords and AdSense services, improving was necessary so losing the opportunity of buying Dioubleclick would have be a very great loss.
Also, Microsoft rapidly backed off, sincerely I think the only thing it participated in the ’sell off’ was a ‘why not’. MS doesn’t really need a company or service like Doubleclick, they have their ‘awesome’ softwares which are best-sellers world-wide. Probably due to the fact that it loosed ground on the search marketing field was also a motivation, as if it could have purchase Doubleclick (which is the main ad-server for sites like MySpace and AOL), could have have a new search-share agreement with Google, this is just my speculation though.
As a “The End”, a quote from Eric Schmidt, Google’s Chairman and Chief Executive Officer:
We are thrilled that our acquisition of DoubleClick has closed. With DoubleClick, Google now has the leading display ad platform, which will enable us to rapidly bring to market advances in technology and infrastructure that will dramatically improve the effectiveness, measurability and performance of digital media for publishers, advertisers and agencies, while improving the relevance of advertising for users.
Links to external sites, related to this article (alphabetical order):
Possible related posts (automatic):
Comments
Loading ...
