Updated: As expected, it’s a complicated deal and the press release only covers some of the ground — and even that isn’t very detailed. For instance, the agreement provides for enabling Google Talk and AIM users to communicate with each other “provided certain conditions are met” but doesn’t spell out the conditions. Ditto for an intriguing suggestion that “Google, AOL and Time Warner may choose to expand the new partnership to Time Warner’s other advertising opportunities.”
Some of the bullet points include:
– creation of an AOL Marketplace, a white-label version of Google’s ad technology, so AOL can sell search advertising directly to advertisers on AOL sites.
– extension of the existing Europe agreement, including the right to extend the AOL Marketplace internationally.
– making AOL content more accessible to Google web crawlers.
– expanding display advertising across the Google network.
– collaborating on video search. (Not sure how this will fit in with AOL’s current multimedia search.)
Google wil be the only shareholder in AOL, which raises the question of whether AOL can sell additional equity without Google’s permission. AOL retains “management control” and “full strategic flexibility” over AOL. Google gets “certain customary minority shareholder rights, including those associated with any future sale or public offering of AOL.”
Update: CNET News.com: AOL will get a $300 million credit to buy search-related advertising on Google’s third-party network; AOL can use the credit through Google’s AdWords auction system or for other undetermined promotional purposes, according to Google exec Marissa Mayer. Google will help AOL with SEO but Mayer said it won’t result in preferential treatment:”We provisioned into the deal that there will be no way to influence the core search algorithm.”
Washington Post: Google CEO Eric E. Schmidt: “There are a lot of aspects of this deal that will have big impact. What I like about this deal is that it has an end-user component and an advertising component” with benefits for both. Time Warner Chairman and CEO Dick Parsons said it was easier to work out a deal out with Google than with other companies like Microsoft. “We knew more about how to tease out the opportunities for both sides.” He told the Post that over time, the partnership could include digitizing Time Warner’s television shows, movies and print news to make them searchable and usable by online viewers.
NYT: More from Schmidt: “”We have not offered a complete advertising solution until this point. This is about expanding the network of our revenue and partners and advertisers, and we couldn’t do that by ourselves. … AOL is going to do really well as a result of our partnership,” Mr. Schmidt said, “and this is a way for us to share in the gain.”
NYT II: I meant to link to this earlier in the day. Some details about the display ads involved in the deal. The patron saint of text ads will test various graphical options that will be available to all advertisers.
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