Google snaps up media distributor Feedburner

Terms of deal for RSS technology pioneer undisclosed; estimates range at about $100 million. June 1 2007: 6:59 PM EDT

SAN FRANCISCO (Reuters) -- Google Inc. said Friday it is acquiring Feedburner Inc., bolstering the Internet advertising leader's capacity to distribute both media and advertising to blogs and social network site users.

Terms of the deal were not disclosed, a Google spokesman said, although various blog reports in recent weeks had put the price of a potential deal at about $100 million.

On Thursday, Panoramio, a site founded by two Spaniards that allows digital photographers to plot the geographic location of their pictures on Google Maps or Google Earth, was acquired by Google (Charts, Fortune 500), also for undisclosed terms. In March, the site said it had mapped more than a million user photos.

Feedburner is a pioneer in the market for delivering the latest updated information to other Web sites using technology known as Really Simple Syndication (RSS). Customers include the Wall Street Journal, BBC and Inc (Charts, Fortune 500). More recently, retailers and travel agents have begun sending promotional offers to online customers via Feedburner.

Google also sees the technology as a way for its base of hundreds of thousands of advertisers to reach some of the most active groups of Web users - social network members who use mini-applications called widgets or the growing audience surfing the Internet over mobile phones, executives said.

"We're constantly looking for ways to identify and offer new tools for content creators and Web site publishers," Susan Wojcicki, Google's vice president of product management, said in a blog post, adding that the purchase helps it provide new tools for its hundreds of thousands of advertising customers.

Feedburner also offers analytics to help Web publishers understand who reads their sites, as well as embedded advertising allowing Web site publishers to get paid by advertisers based on the audiences they attract via RSS feeds.

"It is going to get more and more important for publishers to have this round-trip view of their audience," Feedburner Co-founder and Chief Executive Dick Costolo told reporters on a conference call. Costolo is joining Google as an executive.

The deal, while small in financial terms, is the latest in a series of rapid moves to consolidate the fast-growing online advertising market. The deal would expand Google's existing blog advertising service, known as AdSense for feeds, which delivers targeted advertising tied to Web page content.

Two weeks ago, rival Microsoft Corp. (Charts, Fortune 500) announced its largest-ever acquisition, a $6 billion deal to buy aQuantive Inc., the largest independent online ad company.
In April, Google agreed to acquire an aQuantive competitor, DoubleClick, for $3.1 billion.

Feedburner counts more than 430,000 Web site publishers as users of RSS. A total of 736,000 RSS feeds, including roughly 110,000 audio or video feeds, are delivered to readers as publishers update their Web sites, the company said. The 30-employee company will remain based in Chicago.

Feedburner has raised $10 million from Mobius Venture Capital, Portage Venture Partners, Sutter Hill Ventures, Draper Fisher Jurvetson and Union Square Ventures.


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