AOL did not disclose the amount of the deal, which took place during December. But sources familiar with the transaction say the No. 3 web portal paid close to $50 million for Burlingame, California-based Truveo.
AOL was not the only search giant interested in buying Truveo, which has 12 employees. But its winning bid accelerates competition among the top search engines to control video search as an ever-growing quantity of video content migrates to the Internet.
Like traditional text search dominated by Google and Yahoo, much of the money in video search will come from online ads. Advertisers spent $225 million in 2005 on online video ads, according to estimates from research firm eMarketer. That figure is expected to grow to $640 million by 2007, and will likely hit the $1-billion mark in 2008.
「グーグルとヤフーによって支配されている既存のテキスト検索同様に、ビデオ検索に於ける収入の多くは、オンライン広告によるものだ。リサーチ会社のeMarketer社によれば、2005年のオンライン動画広告市場は$225 millionだった。この数字は、2007年は$640 million 、2008年は$1-billionになると予想される。」
Yahoo, Google, Microsoft, and IAC’s Ask Jeeves are jockeying to deliver the sort of programming once solely provided by broadcasters and cable television. AOL, with access to Time Warner’s vast library of music, television, and movies, has an edge.
“It’s important for the company to create a formidable offering in its video search if it’s going to intensify its broadband-friendly environment,” said Tom Forte, a consumer analyst at Geneva Investment in Chicago.
AOL said it will fold Truveo’s video search technology into the company’s own search and video products in the coming months. The purchase follows AOL’s acquisition of Singingfish during November 2003 and the company’s launch of AOL Video Search during July (see AOL Offers Customization).
During December, Google said it was paying $1 billion for a 5 percent stake in AOL (see How Google-AOL Alters Search). In addition to access to AOL and Time Warner’s vast content reserves, Google’s deal with AOL outflanked a competing offer from Microsoft.
While AOL declined to release numbers for the Truveo deal, a company spokesperson did allow that it is the largest acquisition by the company since it bought Advertising.com during June 2004. That deal was for a reported $435 million.
Founded by Tim Tuttle and Adam Beguelin during January 2004, Truveo debuted its video search technology during September 2005. Almost instantly, it became the subject of intense takeover speculation. AOL and its competitors eyeing Truveo wanted its technology.
Jeff Clavier, an angel investor in Truveo, and a venture capital consultant, said it makes sense for AOL to buy Truveo’s technology now. “It is cheaper and it is easier to integrate,” Mr. Clavier said.