Microsoft and DoubleClick: Indecent Proposal
The biggest mistake of my career was not accepting a job offer with Microsoft back in 1995. I still have the offer letter to remind me that it can be really hard to judge opportunity when it knocks.
I imagine my friends and ex-colleagues at DoubleClick are going through a similar process with Microsoft right now. I was at DoubleClick when we went through the process of selling the company to Hellman and Friedman and it was not easy.
Don Dodge sums up the dilemma best:
“Strategically it could make sense but the suggested acquisition price is way out of line…”
Does this deal make strategic sense for both companies?
Kate Kaye on ClickZNews points out that the deal..
“would boost the firm’s (Microsoft’s) online ad capabilities and make for ready-made relationships with advertisers and agencies” but might “put DoubleClick in hot water with its publisher clients, including AOL.”
One of the major reasons publishers signup with a third-party ad serving service is to keep companies like Microsoft, Google, and Yahoo out of their ad serving data.
Microsoft gets one of most scalable and reliable ad serving systems on the planet (The engineers who worked with me at DoubleClick built it that way) and a hedge against Google moving into the third party ad serving business.
Hellman and Friedman get a good but not great return on their investment of $1.1 Billion. (The rumored asking price of $2 Billion isn’t going to set any records for ROI.)
I’m not sure what DoubleClick gets out of the deal. They’re growing, they’re making money, they have good market share, and they have a great team… Maybe employee discounts on the new XBOX 360 Elite?
Check out the other stories on Doubleclick/Microsoft on Paid Content.org and HipMojo.com.
-- John Pavley
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