On Friday, 4/13/07 Google announced the acquisition of Internet service provider, DoubleClick, for $3.1 billion. Friday the Thirteen, was bad luck for Microsoft, Yahoo and Ask, but good luck for Google.
DoubleClick's purchase marks Google's second foray into the Web economy in the past 6 months. Google paid $1.65 billion for YouTube last November. Google's YouTube purchase was all about traffic (and Copyright legal hassles), while the DoubleClick buy is about Internet ad services. Microsoft had been in the hunt for DoubleClick, just as they had been for YouTube last year.
If Google keeps beating Microsoft to the punch, Bill Gates may no longer be the richest man in the world. And the world's richest duo, Gates and Allen, could go the way of Burns and Allen:
- B Gates: "Say, Good night, Paul."
- P Allen: "Good night Paul."
Many Web publishers, advertisers and their agencies rely on ad-serve companies, such as DoubleClick, to insert ads on the fly, when a searcher pulls up a Web page. Time Warner's AOL and News Corps' MySpace are two of DoubleClick's major customers.
In it's 2/19/07 cover story, Fortune reported Zillow's growth, in less than a year, to the fifth most visited Real Estate Website. Zillow's 2.3% of the market and almost 4 million visitors per month make Zillow's turf prime online real estate for a bidding war.
The Google/DoubleClick deal was a windfall for the private equity firm, Hellman and Friedman, which bought DoubleClick in 2005 for $1.1 billion. Two Billion in 2 years. Almost a 200% gain. Might Google do the Zillow's 3 VC's a similar favor?
With $57 million in Venture Capital, firms have invested heavily in Zillow's potential to deliver the home buyer and seller (eyeballs) traffic, the life blood of Search Advertising for Google, Microsoft, Yahoo and Ask/IAC.
Yahoo's Real Estate information is provided by Prudential, who recently denied Zillow and Trulia booth space at Prudential's National Meeting in California. If I suspected Google, MSN or any of my other competitors were checking out Zillow, I wouldn't have let them in either.
With Sarbanes-Oxley putting IPO's on the endangered species list, Zillow becomes a prime acquisition target, like YouTube and DoubleClick.
Last year the WSJ featured an article about things Google didn't do well:
- Blog Search (Technorati)
- Social Networking (MySpace)
- Internet Video (YouTube).
Google went out and bought YouTube. Other areas of prime interest to Google are Real Estate (Google Base) and Local Search. Zillow in Real Estate (All Real Estate is Local) could help Google deliver in both those areas.
Zillow, with its high power computer algorithm, 2 terabytes of data, extensive national home coverage and user-friendly add-on services, is growing like Topsy (or Google). Will suitors, like Google, MSN or Yahoo, be far behind?
Isn't this prom season? Might there be a June wedding?
Adapt Or Die! Happy Searching.
WebHomeUSAblog; The Blog of Real Estate Search Marketing
Zillow's management team all used to work for MSFT and they already use MSFT Virtual Earth for mapping. It's a foregone conclusion that Zillow will sell to MSFT. Especially when both companies are located in Seattle. The acquisition integration would be easy as they would just close down Zillow's office in downtown Seattle and relocate all the employees in Redmond.
Google doesn't buy vertical applications. They only buy technology infrastructure. Zillow is an app and would never scale to meet Google's needs.
Yahoo already has a partnership with Zillow so they don't need anything more from them.
The real wildcard is Move.com. They should buy Zillow and dump Realtor.com
Posted by: MSN Insider | April 15, 2007 at 01:17 PM