DoubleClick Goes to Google

For $3.1 billion. Amazing. Google has been trying to get into the brand budget in various ways. This is definitely the motivation here. Here’s the NY Times report:

Google reached an agreement today to acquire DoubleClick, the online advertising company, from two private equity firms for $3.1 billion, according to people with knowledge of the deal.

The sale gives Google access to DoubleClick’s advertisement software and, more importantly, its close relationships with Web publishers, advertisers and advertising agencies.

For months, Google has been trying to expand its foothold in online advertising into the area where DoubleClick is strongest — display advertising. Google made its name and still generates the majority of its revenues from search and contextual text ads.

Seemingly a blow to MSFT (certainly a PR blow at the very least) and now something of a threat to Yahoo! because of its brand advertiser implications.

The price tag suggests an auction took place with possibly MSFT and others. DoubleClick also announced an intended exchange last week. This makes Google a much more well rounded online ad company (and network) than it was. It may also boost search spending by brand advertisers with whom it will have relationships through DoubleClick.

Display advertising is projected to grow faster than paid search, as brand marketers come online in greater numbers:

Source: BusinessWeek in answer to the question: Which medium will represent the largest percentage increase in spending this year for your brand (or your top client)?

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Here’s the WSJ (sub req’d) article. And here’s MediaPost (reg req’d) on what Google gets out of the deal.