Google Clicks Twice

You really shouldn't be getting your news here first (especially not this story), but I had to put something up about Google's $3.1 billion acquisition of DoubleClick, the online banner advertising giant, on Friday. Here is a link to the story on TechCrunch, and here's an interesting article up today on GigaOm.

Arrington makes an interesting point in his article - Google paid a price that's 10x the company's revenue, a staggering amount for a mature company.

Some of the pundits have been calling it a "strategic acquisition" to justify the price, but something just seems off to me. $3 billion is a lot of money, and I think it's probably too much. Microsoft had been rumored to be interested at around $2 billion, but Google came (way) over the top.

What do you guys think? Is Google getting carried away with these purchases just because they have boatloads of cash, or is DoubleClick really worth that much? And another odd point - does anyone notice how much less attention this purchase is getting than that of YouTube. Google spends twice as much money and gets half as much press. I mean, everyone around campus was talking about the YouTube deal, but I haven't heard anyone mention DoubleClick over the past few days.

On a quasi-related note, is it just me or is the tide turning against the Mountain View titan? Maybe turn is an overstatement, but I think the winds are beginning to change. Fred Wilson has a great post up today where he astutely points out that Google has to start worrying more about the quality of their lawyers than that of their engineers, which can never be a good thing.

As they've become a big company, they're inevitably lost some of their ability to innovate or even incubate innovation. Just read the Dodgeball founders' post on Flickr. Dodgeball was all the craze not that long ago, but, after being acquired by Google, they've been beaten out by Twitter in the social texting space. The founders complain, rightfully so, that the lack of resources Google sent their way was to blame for the loss in market share.

Wow, this post got longer than I had planned. My basic question is what do you think about all this? As usual, disagreement is highly encouraged and preferred...