The two largest web advertising server companies – Doubleclick and Real Media – are in discussions that could lead to a merger, according to a report on internet.com today.
The article claims that Doubleclick, the larger of the two companies, is looking to acquire Real Media’s OpenAdStream technology from parent company PubliGroupe.
Switzerland-based PubliGroupe recently reigned in Real Media’s activities to concentrate solely on technology sales, following heavy losses at its internet-related businesses. Today’s report suggests that the company is now looking to get shot of Real Media altogether. Both companies have declined to comment.
A merger of Doubleclick and Real Media would probably make sense given the substantial fall out of the size of – and confidence in – the online advertising market.
Internet-focused businesses have virtually all struggled since the dotcom boom began to retract and it became clear that advertisers were not making the kind of money out of the Net that had initially been anticipated.
Jobs, revenues and confidence in the online sector to deliver significant returns on investment are all at a low. This has led to a shift in focus for online ads, as evidenced by a number of surveys recently which suggest that it is not in fact sales and direct revenue that can be achieved through internet advertising, but rather a general branding and awareness building (see Forecasts, Forecasts and Forecasts).
In point of fact, it seems that no-one has really quite figured out whether web advertising is of any great value of all. Given the ‘active’ nature of the web user, it may be that placing a subconscious brand awareness in people’s minds is as much as can be hoped for. At worst, ads may be barely glanced at. To combat this problem we now have pop-ups, pop-unders (see Forecasts), video ads (see Forecasts) and a whole host of techniques designed to grab the attention of the web user for a few moments.
However, until the online advertising market consolidates itself and settles down to a period of not boom or bomb, but rather steady and measured development, larger ad server companies – like a combined Doubleclick and Real Media – may be better placed to weather the storm.
