{"id":136050,"date":"2024-09-17T02:51:13","date_gmt":"2024-09-17T02:51:13","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/09\/17\/us-google-saw-ad-startup-as-a-threat-and-bought-it-times-of-india\/"},"modified":"2024-09-17T02:51:13","modified_gmt":"2024-09-17T02:51:13","slug":"us-google-saw-ad-startup-as-a-threat-and-bought-it-times-of-india","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/09\/17\/us-google-saw-ad-startup-as-a-threat-and-bought-it-times-of-india\/","title":{"rendered":"US: Google saw ad startup as a \u2018threat\u2019 \u2014 and bought it – Times of India"},"content":{"rendered":"
\"US:<\/div>\n
Google<\/a> bought advertising technology provider AdMeld in 2011 because the search giant saw the startup as a \u201cthreat\u201d to its online display ad strategy, antitrust enforcers sought to show at trial Monday.
The purchase of the company was portrayed by the Justice Department in its monopolization trial against the Alphabet Inc. unit as an example of so-called killer acquisitions.The government alleges that Google bought up nascent rivals, starting with DoubleClick in 2008 and followed by AdMeld and Invite Media, to build up a dominant position and stifle competition for its online ad tools.
After purchasing DoubleClick, maker of the web\u2019s leading ad server, Google employees debated whether to buy a company that made \u201cyield management tools,\u201d which help websites analyze data for ad pricing. Leading yield management companies at the time included AdMeld, PubMatic Inc. and the Rubicon Project.
In an internal presentation shown in court Monday, Google staff dismissed the technology as \u201cirrelevant,\u201d but said the tools were getting in the way of the search giant\u2019s opportunities to include more website ad inventory on its ad exchange platform.
Google purchased AdMeld for more than $400 million and, after integrating its technology into the company\u2019s advertising exchange, shut down the product two years later.
The Justice Department and a group of states allege that Google has monopolized the market for advertising technology tools used by websites and advertisers to buy and sell online display ads. Antitrust enforcers are seeking to show that Google bought rival companies to solidify its power in the online ad market.
In an October 2010 email to a colleague, YouTube<\/a> CEO Neal Mohan, then a leader at Google\u2019s display advertising division, wrote that the company had \u201cmissed the yield manager threat.\u201d
Mohan, who joined the search giant when it bought DoubleClick in 2008, suggested in a message to colleagues that Google should buy one of the leading products by \u201cpicking up the one with the most traction and parking it somewhere.\u201d
In court on Monday, Mohan denied that he was suggesting Google buy AdMeld to eliminate a competitor.
\u201cAbsolutely not,\u201d he said. AdMeld\u2019s technology \u201cwas a gap in our portfolio.\u201d
\u2018Close that gap\u2019<\/span>
\u201cWe needed to close that gap as quickly as possible,\u201d Mohan added.
In the same presentation about whether the company should acquire a yield manager, Google said that buying AdMeld or PubMatic would close \u201cproduct and service gaps\u201d and was \u201ca pressing need for publishers.\u201d An acquisition would also \u201censure fair access to publisher inventory.\u201d
In his testimony, Mohan said that AdMeld was a \u201ccomplement\u201d to Google\u2019s advertising exchange, AdX, a platform which matched advertisers with websites that wanted to sell space.
\u201cYield management did something adjacent to, but different than, what AdX did,\u201d he said.
Mohan said that in his view Google\u2019s products were more advanced than yield management tools, likening AdX to streaming video while AdMeld and PubMatic were DVDs aimed at \u201csolving yesterday\u2019s problems.\u201d But many websites were \u201cmore cautious\u201d about taking the leap to Google\u2019s products, Mohan said, and were more comfortable adopting tools like AdMeld and Pubmatic, which he described as \u201cbaby steps\u201d away from the technology they were used to.
At the same time, Mohan acknowledged that Google\u2019s acquisition of both DoubleClick and eventually AdMeld was done in order to keep the technology giant from \u201cfalling behind\u201d on its ad-tech offerings.
\u201cIf we lose platform share, we can build the best\u201d advertising platform \u201cin the world but will still be at a severe risk of being disintermediated\u201d by large competitors, Mohan wrote in a March 2009 email to colleagues, referring to companies such as Yahoo Inc. and Microsoft Corp., which were working on building up their own ad offerings. In the same email, he later added that Google needed \u201ctight bundles\u201d in its ad offerings that it could offer both publishers and advertisers in order to stay competitive.
Google employees estimated that AdMeld was worth between $182 million and $355 million. Mohan acknowledged that Google ultimately paid $100 million above what the search giant estimated AdMeld\u2019s value was. <\/div>\n