Google Buys DoubleClick
turbotodd 100000388Y Visits (3034)
What a way to end the week. Google is buying DoubleClick, says the New York Times, for $3.1B.
The press release from Google is here. (It includes a call taking place now that will be available for replay).
That's a pretty penny to pay for a company taken private in 2005 for $1.1B...then again, Google keeps DoubleClick out of Microsoft's hands. As an analyst in the Times' piece observes, "Keeping Microsoft away from DoubleClick is worth billions to Google."
Gonna be lots of blogosphere spin on this one over the weekend....
After sleeping on it overnight, and now having listened to the full conference call with the chief executives and leadership teams from both Google and DoubleClick, let me throw in my two clicks...er, cents.
Though some are saying that Google bought itself a Web 1.0 company (with cash, mind you..."Hey Sergey, it's Eric! Could you run into the Google vault and grab a few pallets of gold so we can pay for these DoubleClick guys, please?! Thank you!!"), what they fail to follow up with is that we're now living in a Web 2.0 world in which massive amounts of advertising dollars are fleeing the old world and sailing off in search of the new.
The new world promises even more gold on that great shiny adserving city on the hill, including mounds filled with data and the ability to integrate, which in turn provides more accountability to advertisers and publishers.
To do all that, search and display advertising must become more synergistic, and what better way than for the world's largest search advertiser to hitch its boat to the world's largest online display advertiser?
According to the press release announcing the intended acquisition, the primary beneficiaries were three-fold:
All that is basically difficult to argue with. The idea of having more accountability and more synergy is a positive. It brings efficiencies to advertisers and publishers alike, and can help provide consumers with a better advertising experience.
As to the observations about this deal being a "brazen attempt to take away Microsoft's future air supply" for its software-as-service model, there are other plenty other adserving vendors on the seas separating the old world and new, just none the size of DoubleClick.
No, I believe the big elephant swimming just offshore in this deal is consumer privacy.
As much as Sergey Brin attempted to play offense on the privacy question during the teleconference, we are about to find ourselves with two companies bringing lots of personal data (via cookies, existing ad profiles, search data, etc.) together in a thick soup of admittedly very powerful new world marketing mix.
Back in 1999, DoubleClick was taken to task (and ironically probably made this deal much cheaper than it would have been due to the pounding its stock took in the process) in the privacy spotlight for something it never even actually did (merging its Abacus offline sales data with online profiles of its adserving adherents).
This time around, the potential for misuse and abuse is much greater -- merging very personal search profiles which are probably already too invasive with those of the users' extensive clickstream across the Web -- than it was back in 1999 -- there is much decreased transactional friction with most of the data now being online, requiring much less calories for a massive merge and purge.
And yet hardly anyone has mentioned the word.
True, it is a vastly different world we live in than 1999, and folks are much more freewheeling with their personal information, particularly the younger set.
And yet we're also finding that there are prices to be paid for such frivolity with one's digital image, reputation, and personal information -- employers conducting online digital dossiers of new hires, scanning everything from Facebook profiles to newsgroup postings before making hiring decisions.
As a recent New York magazine article about young people and privacy observed:
"Every street in New York has a surveillance camera. Each time you swipe your debit card at Duane Reade or use your MetroCard, that transaction is tracked. Your employer owns your e-mails. The NSA owns your phone calls. Your life is being lived in public whether you choose to acknowledge it or not."
So sure, why not throw in their merged Google and DoubleClick clickstreams while they're at it? Who needs thoughtcrime when you've got a perpetual clickstream?
Then again, Julia and Winston got over it all...after a little conv