Travelling Soldier

Google buys out the grand daddy of online advertising,DoubleClick- which is known for placing display advertising on multiple websites,a business that google is just getting started in. In last term of MBA,I worked on Google’s business strategy focusing on advertising business and concluded how google should make moves for it survival and dominance. Acquiring other advertising firms was one of the recommendations.

This acquisition will help Google to compete with Yahoo,AOL,Microsoft more fiercely. Microsoft was also in the race to buy DoubleClick but I think they couldnt make the best deal for DoubleClick. Google has offered $3.1 billion,a mere 2% of its 145 billion market cap,to Doubleclick. This amount is almost double to what it paid to acquire Youtube.

Google is becoming like an operating system for placing banner ads and is a major step in reaching the strategic objectives of Google i.e., transforming itself (search engine) into advertising powerhouse. Doubleclick notonly bring great advertising software but brings in relationships with Webpublishers,advertisers and ad agencies.

“This merger is really a part of a global growth strategy for Google,” Eric E. Schmidt, Google’s chief executive, said in a conference call. Mr. Schmidt said that being able to kick-start Google’s display advertising business and marry it with search advertising was the most compelling reason for the purchase. Keeping Microsoft away from Doubleclick and advertising business will be worth more billions than what google is offering doubleclikc and other ad startups.

A highflying stock in the late 1990s, DoubleClick was an early pioneer in online advertising and was one of the few online ad companies to survive the burst of the dot-com bubble. In 2005, it was taken private by two private equity firms, Hellman & Friedman and JMI Equity, in a deal valued at $1.1 billion.

Since then, the company has sold two data and e-mail advertising businesses and acquired Klipmart, which specializes in online video. DoubleClick generated about $300 million in revenue and $50 million in earnings before interest, depreciation and taxes last year, mostly from providing ads on Web sites.

The 22yr old founder of facebook.com could be sitting on a potential gold mine that could be make him the next Silicon Valley’s whiz kid to strike to rich or he could become one more poster boy(like the founder of friendster) for missed opportunities if he waits too long to cash-in.Facebook Inc., is expected to generate revenue of more than $100million this year.He thinks there is more stuff in facebook that can be unlocked in future. Deep-pocketed companies are now angling for a piece of the web 2.0 action - a quest that has yielded couple of big jackpots.News corp paid about $580mn in 2005 for Myspace and Google paid about $1.5bn last year for video sharing pioneer Youtube. Facebook is still a niche site with an experience specifically targetting college students. One would be amazed to know the amount of time people who should probably be studying are spending over facebook making fun of the fact that they are spending too much time on Facebook(this is same with orkut).

Facebook Infomercial Parody

This is a skit from Penn Masala group(worlds first & premier hindi a cappella group).

Myspace vs. Facebook Blog Wars Funny Parody