Actually, large publishers do and will participate in an exchange. Being that I work for Right Media, I know our client list and there are many large publishers on it who are participating in our exchange at large volume levels. Not only has our exchange raised their revenue on unsold inventory, it has had no negative impact on their premium sales channel.

I do agree that not giving more transparency could hurt DCLK’s exchange offering.

I also agree that integration is a large challenge, but not an insurmountable one.

Relationships are key in this business but the most important aspect of any ad relationship is performance.

Only time will tell if Google and their plan will work but one thing is for sure they are scaring the hell out of the market.

Google is after the branded advertisers and large scale publishers. They have the small to mid size market wrapped up IF they are able to migrate the larger players over to their services they will control the vast majority of ads online. Whether this works in their favor over the long haul is difficult to assess but in the coming months and years it will not be a good thing for mid tier companies like ValueClick

You’re also ignoring the organization integration challenges (1200 DCLK employees), tons of technology integration hassles, data segregation and compliance issues, and the conflicts of interest involved with this acquisition (e.g., how can they possibly keep the Performics SEM–which, btw, is no Avenue A/Razorfish). It will be very hard for Google to keep 100% of what it has bought in terms of relationships, imho.

As for relationships, VCLK has plenty among advertisers and is close to the top of the ad network daisy chain for a lot of important publishers. Sure, these relationships are not as well “integrated,” but we’ll see how integrated DCLK is once publishers begin excercising the change of control provisions in their contracts.

Let’s try to remember what DCLK was like about 24 months ago: a sinking ship. I had a friend who worked there in inside sales around that time, and it was pretty obvious they had major issues. The business has supposedly improved since then, but most people I talk to tell me that they are continuing to lose market share to Atlas on the agency side and Open AdStream on the publisher side. I guess we’ll see if GOOG can change that.

Well, Google is an ad network, and a VERY powerful one. Yes, Adsense and Adwords relationships with Google can be dropped very easily, but they have such a dominant position in that space and much less competition than Valueclick has in their space. Valueclick also does not share the same dominance.

Google is strengthening their general ad game by buying DCLK which has deeper relationships. So Google is protecting their ad network business that is so valuable to them by most likely trying to integrate their ad network with the deeper ad serving relationships.

Thanks for the nice comments Jeff.

aQuantive (AQNT) becomes of more interest given its similarities (Performics is to DCLK as AvenueA/Razorfish is to AQNT).

With the addition of Performics (a unit being all but completely ignored by analysts), GOOG will begin to resemble aQuantive with a twist — GOOG will carefully balance self-service ad management tools (aimed at advertisers direct AND agencies) with high end marketing services (via its Performics unit which looks a lot like AQNT’s AvenueA).

This serves all advertisers… those who value self-service scale and those who need full blown agency services. Many are suggesting that this isn’t possible but I beg to differ.

Precisely, Pat. VCLK’s ad management tech (market penetration, relationships) cannot rival Doubleclick’s. You’re the only one to nail this so far.

However, your argument about ad networks being a relationship that is dropped very easily leaves me with the question: Who is the better Google?

What is Google if not an ad network? Then, wouldn’t their relationships be easily dropped?

In essence, then what you are saying is that although Google’s biz performs better than DoubleClick’s, DoubleClick’s biz is better because it’s deeper?