WPP Acquires 24/7 Real Media To Compete With Google And Yahoo

I saw one of Google’s (GOOG) “agency relationship managers” give a pitch to a top agency, where she gave the standard line that Google doesn’t want to be an ad agency. I didn’t believe it for a second. And neither does WPP (WPPGY), one of the top agency holding companies, which just announced the acquisition of 24/7 Real Media.

Why did WPP buy 24/7? To compete with Google and Yahoo! (YHOO).

Google AdSense is the largest ad network in the world, and Google recently acquired DoubleClick, which owns the #1 display ad serving solution (24/7 Real Media has the #2). Google offers free search marketing services to its largest AdWords advertisers. DoubleClick’s Motif product offers free creative services to publishers who want to create custom online rich media ads for advertisers. Yahoo recently acquired Right Media, a successful dynamic marketplace for unsold ad inventory. Yahoo has one of the largest sales channels for online display advertising.

Do you see the disruption of the ad agency business going on here?

24/7 Real Media has an ad serving business, a search marketing business, and an ad network business:

Its business spans three key sectors in the rapidly-changing digital media industry - media, search and technology:

its media business is one of the largest CPM-based media networks with more than 950 participating sites and 115 million monthly unique users worldwide.

its search business provides clients with strategic advice and consulting on search engine optimisation (SEO) and search engine management [SEM] for Google, Yahoo! and MSN as well as other search engines and shopping comparison services.

its technology business offers the number 2 publisher-side advertising management platform to more than 400 clients.

It used to be there were media companies and ad agencies. Media companies created the ad inventory. Ad agencies created the ads and bought the inventory. Online, there are ad dollars and — dare I say it — vertically integrated media and advertising companies trying to grab as many of those ad dollars as possible.