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Google buys DoubleClick for $3.1 billion

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Google just bought Double Click for $3.1 billion, news which wasn’t received too well by the stock market – shares are trading down a buck-and-change a share. The all-cash deal is almost twice what Google paid for YouTube, the New York Times reports. The amount Google spent is shade under Google’s revenues in the fourth quarter of 2006 ($3.21 billion) and what the company earned in entire 2006. At the end of 2006, Google had $11.2 billion in cash.

“Google really wants to get into the display advertising business in a big way, and they don’t have the relationships they need to make it happen,” said Dave Morgan, the chairman of Tacoda, an online advertising network. “But DoubleClick does. It gives them immediate access to those relationships.”

One thing is becoming clear – Google wants to dominate the online advertising business, and will pay anything to keep rivals like Microsoft on a weak footing. It was rumored that Microsoft was considering a bid for DoubleClick for around $2 billion.

Also: What is the future of Ad Exchanges?

37 Responses to “Google buys DoubleClick for $3.1 billion”

  1. Other prominent members in this space include ScreenTonic (acquired by Microsoft just over a week ago), DoubleClick (acquired by Google), TellMe (acquired by Microsoft) and more.

  2. Microsoft is not stuck in a rut Microsoft is a rut! Right now Microsoft pushes ever competitor around in every category and there should be at least ONE company who can push back in ONE category. I say let Google grow! After twenty years Microsoft finally has a competitor!

  3. Well with 11 billion in cash 3 billion doesn’t seem that much now does it? It will be interesting to see where Google actually goes with this buy. Obviously googles tracking reach gets that much more wider.

  4. Not much has been said here about Microsoft’s lost financial opportunity. The basic issue for Microsoft should not have been the price tag for DC, as apparently it was, but the impact the acquisition might have had on correcting a fundamental problem. MSFT is stuck in the rut between software/servers with Oracle’s value/revenue multiple of 7 and gaming with Nintendo’s v/r multiple of 4. Buying DC even at $4 billion could have put it on track to Google’s v/r multiple of 14 in the search/advertising space. MSFT was sidelined by Google … again. Readers are invited to check out my analysis at

  5. I am a little guy on the Internet … a small Web publisher with tiny amounts of advertising inventory … and I’ve been thinking of using one of the ad-serving technologies for sometimes … DoubleClick, Accipiter and 247realmedia. I hated one fact about all these guys … none of them had a proper demo on their site, not to even think about a free trial. 247realmedia promised one of their execs will get in touch with me – nothing happened!

    I am so happy Google has bought out DoubleClick. So I am sure instead of fancy acronyms like DART, there will be usable demos and free trials on the site.

    God bless GOOG. I just hope their performance on the market will reverse soon enough.

  6. In addition, only 2.7 million shares of GOOG traded hands today, making it their lightest session of 2007. More than anything else, the market really yawned at Google’s news.

  7. GOOG closed down $1.10 but that’s hardly “news which wasn’t received too well by the stock market”. $1.10 is less than a quarter of a percentage point for GOOG.

    On many trading days, GOOG moves a lot more, so it would be more accurate to say that the market really didn’t react at all to the news.