Google buys DoubleClick

16 April 2007 11:01 GMT / By Stuart Miles

Google has expanding its advertising reach even further with the acquisition of ad firm DoubleClick.

The search engine has announced that it is paying $3.1 billion in cash for the company and in the process gains software for creating and measuring internet advertising campaigns.

The acquisition, announced late Friday and the biggest ever for Google eclipses the YouTube deal which cost Google $1.6 billion last year, represents a windfall for Hellman & Friedman, the private equity firm in San Francisco that bought DoubleClick for $1.1 billion in 2005.

Businesses ranging from MTV Networks to Pocket-lint use DoubleClick's Dart program to display and monitor adverts.

"The news will be bad news for big 'run of network' agencies like 24/7 Real Media because Google will be able to bypass them and run display advertising themselves if they want. Smaller bespoke advertising shouldn't be affected however", an industry insider told us.

"We are truly excited to announce our acquisition of DoubleClick. DoubleClick provides a suite of products that enables agencies, advertisers, and publishers to work efficiently, that will enable Google to extend our ad network and develop deeper relationships with our partners", Google said in a statement.

Microsoft however as replied with sharp criticism releasing the following statement by Brad Smith, Senior Vice President and General Counsel, Microsoft Corporation, on the proposed acquisition of DoubleClick by Google:

"This proposed acquisition raises serious competition and privacy concerns in that it gives the Google DoubleClick combination unprecedented control in the delivery of online advertising, and access to a huge amount of consumer information by tracking what customers do online. We think this merger deserves close scrutiny from regulatory authorities to ensure a competitive online advertising market.”

Google has also said that it will continue to apply fees for DoubleClick customers rather than offer a free service as it does with its Google Adsense product.

At the height of DoubleClick success shares traded for over $134 in 2000, although shares collapsed along with other Internet stocks in March 2000 and traded as low as $4.53 on Aug. 5, 2002, this deal values the shares at $31.

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