Google's Purchase of Doubleclick Has Some Far Reaching Implications
Google's $3 billion+ purchase of Doubleclick will have a pretty big impact on the Web economy. Doubleclick used to be a publicly traded company during the first Web boom in the late 90's, which then went private in a $1.1 billion dollar transaction. Now, Google has bought the company for $3 billion+, easily outbidding their competition yet again. They really wanted this company.
The big question is: if Google was building their own display ad system, then why would they buy Doubleclick for such a large amount, given their market share in contextual advertising and search market in general? Rumors have been floated that Google bought Doubleclick for the large amount of relationships that the company has developed as a result of being the market leader in the display ad industry. This would make sense to me. Google can build whatever technology that they want, and they surely didn't buy Doubleclick for the company's display ad technology. Instead, they want to leverage the company's relationships and contacts. This is why Google put such a high pricetag on the company.
This purchase has far-reaching implications though, and brings about a number of questions that I don't have the answer to:
1) Is Google's ever-increasing market share in Internet advertising a good thing or a bad thing for the small publisher / advertiser?
2) Considering the online gambling industry uses Doubleclick quite extensively, how will Google react, seeing as though they don't allow online gambling ads in their Adwords network?
3) Is this the end of Google's buying spree, or are there more companies to be swallowed up by the Google behemoth?
4) How will Google utilize the seemingly massive amount of user data that they will acquire from Doubleclick in this deal?
Filed under: Internet Companies