April 16, 2007 -- (WEB HOST INDUSTRY REVIEW) -- Search engine giant Google (google.com) announced on Monday that it has acquired US-based Internet marketing group DoubleClick (doubleclick.com) in an all-cash transaction for $3.1 billion - its largest acquisition to date. The acquisition will enable Google to extend its search-based advertising service into the realm of display advertising, further reinforcing its grip on the Internet advertising market.
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Although banner advertising on Web sites is arguably less effective than search-based advertising because of the product or service being promoted is irrelevant to the consumer, Google say it will use its technology to match content with DoubleClick's banner advertisements.
DoubleClick will also help Google as it seeks to move into the print, radio, video, mobile and TV ad markets. Google purchased DoubleClick from US private equity group Hellman & Friedman, which had paid $1.1 billion for its majority stake in the company in 2005.
According to US reports, Google beat out competitors Microsoft, Yahoo and Time Warner AOL in the auction to buy DoubleClick. Meanwhile, Google shares on Nasdaq dropped by $3.28 to $463.01, a 1 percent decline, immediately following the DoubleClick acquisition announcement.
In the wake of the announcement, reports emerged that Google's Internet marketing rivals are expected to urge regulators to examine the deal closely, fearing antitrust violations. Executives from businesses like AT&T and Time Warner have warned that the acquisition may put Google in a position to pick the winners and losers in the Internet marketing busines.
Google said when it announced the deal that it expects the arrangement to be approved by regulators.
