GOOGLE-AOL ALLIANCE GIVES TWO BROADEST AD REACH ON WEB

The AOL and Google deal, sealed yesterday, gives the two advertising power and reach that no other entity on the Internet possesses. It will also give AOL what appears to be a preferred position among Google partners. And it gives Google and its ad clients access to rich content through AOL programming.

AOL and Google finally wrapped up details on a business partnership yesterday that will create cross-marketing opportunities for both companies. Under the terms of the pact, Google will pay AOL parent Time Warner $1 billion for a 5% stake in AOL.

The cross-marketing aspects of the deal give AOL advertising clients a chance to bid for search ad sponsored links through Google's contextual-advertising AdSense program. AOL sales staff can also sell sponsored links across AOL search. AOL search will continue to be powered by Google, a cooperation that has existed since 2002 and which brings in about 10% of Google's revenue. Also, Google's ad clients will be able to purchase display ads, of the sort that AOL sells, across Google's network.
'We will build a system for AOL whereby AOL will be able to sell into search for AOL search and those same advertisers will be able to sell into Google AdSense advertiser network,' said Patrick Keane, director of sales strategy, Google, in an interview late last night. He added that details have yet to be hammered out. But that the focus of the partnership 'means a greater inventory of ads,' he said. 'There are going to be interesting relationships and cross-selling across all the inventory.'

Some, however, are already grumbling that the deal will give AOL preference over other Google clients. "It's an extension of the partnership," Mr. Keane said. He added that there will be no special placement or preference for Google's algorithmic, natural search results. | source: NEW YORK (AdAge.com)