Displaying the best display ad with Teracent

Can you spot the difference between these two sample display ads? Of course you can. However, the most important difference is not discernible to the naked eye.

The lower ad was customized and chosen from thousands of different creative elements, automatically and in real-time, by machine-learning algorithms developed by Teracent, a San Mateo, California startup.

We think that this technology has great potential to improve display advertising on the web. That's why we're pleased to announce today that we've entered into a definitive agreement to acquire Teracent. The transaction, which is subject to various closing conditions, is expected to close this quarter.

As you know, we've been busy releasing new features and products to help improve display advertising on the web for everyone. We believe that Teracent's technology fits neatly into these efforts.

Teracent's technology can pick and choose from literally thousands of creative elements of a display ad in real-time — tweaking images, products, messages or colors. These elements can be optimized depending on factors like geographic location, language, the content of the website, the time of day or the past performance of different ads.

This technology can help advertisers get better results from their display ad campaigns. In turn, this enables publishers to make more money from their ad space and delivers web users better ads and more ad-funded web content.

We're looking forward to welcoming the Teracent team to Google and to making this technology available to our display advertising clients — including those who run display ad campaigns on the Google Content Network and our DoubleClick clients.

Update on 12/11/2009: The deal has closed, and Teracent is officially part of Google. 

Posted by Neal Mohan, Vice President, Product Management and Joerg Heilig, Engineering Director

Investing in a mobile future with AdMob

We're happy to announce today that we have signed an agreement to acquire AdMob, a mobile display advertising company based in San Mateo, CA. AdMob is a great Silicon Valley story — founded in 2006 by Omar Hamoui when he couldn't find good ways to generate traffic for his mobile site. Over the past few years, Omar and his talented team have built a thriving company with great mobile advertising products, and we are looking forward to having them join the Google team and work with us on the future of mobile advertising.

We've written in the past about how mobile phones are becoming an increasingly indispensable part of our daily lives, and we continue to see how great devices with full Internet browsers and vibrant app marketplaces are driving an explosion of usage. In fact:

• iPhone and Android users browse the Internet more often than anyone else [Morgan Stanley], contributing to Google's 5x mobile search growth over the past two years
• And a quarter of these same iPhone and Android users spend nearly 90 minutes per day using applications on their devices [AdMob]

Despite the tremendous growth in mobile usage and the substantial investment by many businesses in the space, the mobile web is still in its early stages. We believe that great mobile advertising products can encourage even more growth in the mobile ecosystem. That's what has us excited about this deal.

For publishers of mobile websites and applications, this deal will mean better products and tools and more effective monetization of their content — allowing them to focus more on their users and less on how to generate revenue.

For advertisers who want to reach users when they are engaged with mobile content, this deal will bring better, more relevant ads and greater reach. It will also mean more interesting, engaging ad formats.

Last, but certainly not least, we believe users will benefit from this deal — through more mobile content and through better mobile ads that deliver useful information. And that's good for all of us. For more information, check out this site that we've set up about the deal.

Posted by Susan Wojcicki, Vice President, Product Management and Vic Gundotra, Vice President, Engineering

Innovation in video on the web

Today, video is an important part of many people's everyday activities on the Internet and a big part of many Google products.

Because we spend a lot of time working to make the overall web experience better for users, we think that video compression technology should be a part of the web platform. To that end, we're happy to announce today that we've signed a deal to acquire On2 Technologies, a leading creator of high-quality video compression technology.

The deal is still subject to approval by On2 Technologies' stockholders and review by relevant regulatory authorities, including the SEC, but we expect it to close in Q4.

Although we're not in a position to discuss specific product plans until after the deal closes, we are committed to innovation in video quality on the web, and we believe that On2 Technologies' team and technology will help us further that goal.

We'll update everybody when we're able to share more information. In the meantime, nothing will change for On2 Technologies' current and prospective customers.

Update on Feb 19, 2010: On2 has been acquired by Google.

Posted by Jeremy Doig, Engineering Director - Video, and Mike Jazayeri, Group Product Manager

Caution Concerning Forward-Looking Statements
This document includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the expected timing of the acquisition, Google’s and On2’s ability to close the acquisition, Google’s ability to integrate On2’s technology and employees, and the expected benefits of the acquisition, including that the acquisition will further Google’s goal to enhance the web experience with video. These statements are based on the current expectations or beliefs of managements of Google Inc. and On2 Technologies, Inc., and are subject to uncertainty and changes in circumstances. Actual results may vary materially from those expressed or implied by the statements herein due to (1) changes in economic, business, competitive, technological and/or regulatory factors, (2) failure to receive the required stockholder and regulatory approval for the acquisition, (3) failure to compete successfully in this highly competitive and rapidly changing marketplace, (4) failure to retain key employees, and (5) other factors affecting the operation of the respective businesses of Google and On2. More detailed information about these and other factors that may affect current expectations may be found in filings by Google or On2, as applicable, with the Securities and Exchange Commission, including their respective most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Google and On2 are under no obligation to, and expressly disclaim any such obligation to, update or alter their respective forward-looking statements, whether as a result of new information, future events, or otherwise.

Additional Information and Where to Find It
Google plans to file with the Securities and Exchange Commission a Registration Statement on Form S-4 in connection with the transaction, which will include a Proxy Statement of On2 that also constitutes a Prospectus of Google. On2 will mail the Proxy Statement/Prospectus to its stockholders in connection with the transaction. The Registration Statement and the Proxy Statement/Prospectus will contain important information about Google, On2, the transaction and related matters. Investors and security holders are urged to read the Registration Statement and the Proxy Statement/Prospectus carefully when they are available. Investors and security holders will be able to obtain free copies of the Registration Statement and the Proxy Statement/Prospectus and other documents filed with the SEC by Google and On2 through the web site maintained by the SEC at www.sec.gov and by contacting Google Investor Relations at 650-253-7663 or On2 Investor Relations at 518-881-4299. In addition, investors and security holders will be able to obtain free copies of the documents filed with the SEC on Google’s website at investor.google.com and on On2’s website at www.on2.com.

Participants in the Solicitation
Google, On2 and their respective directors and executive officers may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information regarding Google’s executive officers and directors is included in Google’s definitive proxy statement, which was filed with the SEC on March 24, 2009, and information regarding On2’s executive officers and directors is included in On2’s definitive proxy statement, which was filed with the SEC on April 7, 2009. The Proxy Statement / Prospectus for the proposed transaction will provide more information about participants in the solicitation of proxies from On2 stockholders, which participants may have interests different from On2 stockholders generally. You can obtain free copies of these documents from Google or On2 using the contact information above.