Google buys double click

Google has agreed to pay $3.1 billion in cash for online ad company DoubleClick. This the biggest acquisition by Google. This gives Google a large network of advertisers and Web publishers to serve and sell ads to, and it boosts the search giant's banner advertising business. It lags behind rival Yahoo in this segment. Google has agreed to pay $3.1 billion cash for online advertising company DoubleClick. The deal is expected to close sometime later this year. With its purchase, Google is strengthening its grip on the online advertising market With this purchase, Google breaks its own previous record for acquisition price: It paid $1.65 billion in stock for YouTube last year.

"The most compelling argument (for the deal) is it is accelerating our display advertising business," Google Chief Executive Eric Schmidt said on a conference call with reporters and analysts. "I'm calling from Argentina where Google is opening its latest sales and support office...I was so excited about this."

Google is buying DoubleClick from San Francisco-based private equity firm Hellman & Friedman, which acquired DoubleClick two years ago for $1.1 billion, and JMI Equity and Management. Rumours say that there was a heated bidding war over DoubleClick between Google, Microsoft and even Yahoo and AOL.

This increases Google foothold & can compete with Yahoo's strong display advertising business This makes it even more for Microsoft, which recently launched its own search advertising system.