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DoubleClick to Set Up an Exchange for Buying and Selling Digital Ads

DOUBLECLICK, which delivers marketing messages to Web sites and monitors how many clicks they get, plans to announce today that it is setting up a Nasdaq-like exchange for the buying and selling of digital advertisements.

The service may make DoubleClick a more attractive acquisition target, according to advertising industry executives.

DoubleClick, which opened in 1996 as a pioneer in the placement of banner ads online, has evolved into a company that serves — separately — both buyers and sellers of digital advertisements.

For advertising agencies and media buyers, it helps place ads online and gauge the effectiveness of campaigns. For Web publishers — companies that publish Web content and accept ads on their sites — DoubleClick delivers the ads to the Web sites and sells software that helps make the most of available space.

The new DoubleClick advertising exchange will bring Web publishers and advertising buyers together on a Web site where they can participate in auctions for ad space.

DoubleClick, based in New York, views the exchange as the centerpiece of a growth plan and may derive the majority of revenue from the new service within five years, said David Rosenblatt, the company’s chief executive, said in an interview yesterday. “We already have the largest sellers and the largest buyers,” he said. “This will link them for the first time.”

He described the exchange as a mix of eBay and Sabre, the airline reservations system that travel agents use. The service will let advertisers see information about what competitors bid for particular ads, in the same way that eBay shows visitors past bids. And it will let publishers try to ensure that they sell their ad spots at the highest possible price, the way that airlines try to do with the seats they sell.

“The value of our company depends completely on our ability to maximize our customers’ revenue,” Mr. Rosenblatt said.

Some of the biggest names on the Internet appear to have already seen the value in DoubleClick’s service — or its potential. Google and Microsoft are pursuing bids to buy the company, according to The Wall Street Journal, which said that DoubleClick’s owner, the private equity firm Hellman & Friedman, has priced DoubleClick at more than $2 billion. Hellman & Friedman, which paid $1.1 billion for the company in July 2005, did not return a call for comment last night.

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The online advertisement exchange will make DoubleClick more attractive to a potential acquirer because there is much demand for such a service and little supply, industry executives said. One of the few companies that runs this kind of auction, Right Media, took in $40 million last October when it sold a 20 percent stake to Yahoo.

Sorce and More : www.nytimes.com

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