The Federal Trade Commission (FTC) said that Time Warner has permission to let its subsidiary company AOL LLC make an acquisition of advertising company Tacoda. Tacoda is specifically a behavioral targeting company that reaches 120 million Internet users and has partnerships with 4,000 websites spanning across 122 million unique visitors per month such as NYT, NBC Universal, Food Network, Cars.com, etc. AOL announced its official acquisition announcement on July 24th.
“Behavioral targeting is a fast-growing part of the advertising business, as marketers increasingly look to get efficient and measurable results from their advertising dollars. With Tacoda, we can offer advertisers state-of-art targeting tools,” stated AOL’s Chairman and CEO, Randy Falco.
According to the NY Post, the deal is rumored to be worth around $200-$300 million.
This acquisition proves AOL’s interest to remain hyper-competitive in the contextual advertising market where major players like Microsoft, Yahoo! and Google dominate. Yahoo! bought BlueLithium a couple days ago and acquired Right Media in April. Google bought DoubleClick for $3.1 billion in April 2007. And Microsoft bought aQuantive for $6 billion.
Through this acquisition, it appears that AOL is intending to compete against Google. However, Google powers AOL’s search. Google bought $1 billion worth of AOL’s shares and gained 5% ownership in December 2005. So technically speaking, AOL is competing with one of their own company owners.
