Lots of people have been asking for my opinion on this one, so what better topic to (hopefully) get back into the rhythm of regular blogging.
Without further ado, six thoughts about this acquisition.
1. If MSN had paid $3B for DoubleClick . . . people would have laughed. But because Google bought them, this is a brilliant acquisition.
2. The “A” Word. I’m amazed that only now are competitors starting to band about the “anti-trust” word when it comes to Google. As has been oft-discussed in this blog, Google’s discriminatory pricing and product bundling could have brought up this issue many months ago.
3. Oil and Water. M&A experts will tell you that “culture clash” is often one of the hardest hurdles to overcome for a successful acquisition. This one is no exception. DoubleClick is a people-intensive company, Google is a technology-intensive company. No doubt Google will want to run DoubleClick it’s way. There is going to be some friction initially, trust me.
4. If I was a DoubleClick employee . . . I’d be pretty happy today, as my options are suddenly worth a lot more than they were a month ago. I’d also start polishing up my resume. Google employs computers, not people. There will be big layoffs at DoubleClick.
5. Google must buy their way into traditional markets. There was a time – say two years ago – where Google thought that all they needed to do was come up with cool technology and they would quickly conquer whatever market they were going after. No more. This acquisition (along with deals with TV companies, newspapers, etc) signals that Google recognizes that the old guard isn’t going to just accept Google as their new overlord. Fine, says Google, we have a lot of cash on hand, we’ll just buy our way in. Very smart.
6. Isn’t it a commodity? One thing I don’t understand about this deal is the actual value of DoubleClick technology. To me, ad serving seems to almost be a commodity these days – I’ve looked at this stuff a few times and I have a hard time telling Zedo, 24/7 and DoubleClick apart. In fact, the best argument I’ve ever heard for choosing DoubleClick was “we’re the industry leader.” It’s kind of like acquiring C&H Sugar for their refining process.
7. Overall score card. Overall, I like the acquisition. It just shows that Google is still hungry and that they have no intention of resting on their laurels. Frankly, whenever your company starts to get accused of violating anti-trust laws, you know that your competitors are really worried, and for good reason.