It is being widely reported that Google is acquiring DoubleClick for $3.1B.
Reaction to this announcement has been interesting. Microsoft's Don Dodge says, "DoubleClick ... two years ago ... [was] valued at less than $1 billion ... They later sold off two divisions for $525 million. Yesterday Google paid $3.1 billion for what remained of DoubleClick."
Henry Blodget writes that this is "a big management challenge, a significant price tag, [and] an admission on the largest scale to date that it sometimes makes sense to buy instead of build."
Google VP Susan Wojcicki claims this is "the next step in Google advertising." Susan's words sounded unintentionally ominous, however, after I read Philipp Lenssen highlights of DoubleClick's history which includes a number of issues with privacy violations.
Paul Kedrosky sees this as "a brazen attempt to cut off Microsoft's future air supply" and "a strategic and offensive buy." I disagree with Paul here. I have a hard time seeing this as anything but a defensive move. Microsoft is drawing little air from advertising revenue and will not be for some time. I think it is clear that Google is trying to ward off Microsoft's attempts to pinch off its advertising revenue air supply, not visa-versa.
Nathan Weinberg, normally a huge fan of all things Google, slams the acquisition in two posts ( ), calling it "crazy" and "arrogant". Ionut Alex Chitu notes a passage from John Battelle's book "The Search" on Google's decision to build its own advertising engine back in 1999: "DoubleClick's ads were often gaudy and irrelevant. They represented everything Page and Brin felt was wrong with the Internet."
As for me, I am not sure what to think. On the one hand, this acqusition does bring in some additional revenue, acquires some important relationships with existing DoubleClick advertisers, and helps defend Google's advertising market share, its air supply.
On the other hand, this is a very expensive acquisition of a large company with a history of privacy issues. DoubleClick appears to be culturally different than Google, posing an integration challenge. Put simply, like YouTube, DoubleClick is not Googly. I foresee problems down the road as these two beasts mash together to try to bear useful offspring.