Back five years ago, Cnet announced the complex agreement that AOl and Google came to:
“Google will invest $1 billion for a 5 percent stake in Time Warner’s America Online unit as part of a partnership that expands their existing search engine deal to include collaboration on advertising, instant messaging and video.
Google also is offering a $300 million credit that AOL can use to buy keyword-based ads from Google, the companies announced Tuesday.
Google will become the only shareholder in AOL other than Time Warner. Google also will have “certain customary minority shareholder rights, including those associated with any future sale or public offering of AOL,” the companies said in a statement.”
Five years later, the contract is up – and is being renewed, according to Business Wire:
The global alliance, which has at its core Google’s provision of search services to AOL’s content network and properties, in exchange for a revenue-sharing arrangement between AOL and Google, will be expanded to include mobile search and YouTube.
“Today is another important step in the turnaround of AOL,” said Tim Armstrong, AOL’s Chairman and Chief Executive Officer. “AOL users will be getting a better search and search ads experience from the best search company in the world – Google. After nearly a decade-long partnership in search, we’re looking forward to expanding our global relationship to mobile search and YouTube. All aspects of our partnership will be improved by this deal.”
“We’re excited to deepen our partnership. This agreement combines Google’s expertise in search and advertising with AOL’s strength in online content,” said Eric Schmidt, Chairman and Chief Executive Officer of Google. “It’s particularly exciting to see our relationship expand into video and mobile. These areas are now at the heart of users’ online experiences and at the core of both of our businesses.”
“The companies are not disclosing the financial terms but this time around there’s no $1 billion investment in equity, as was the case in 2005. Instead, it’s all about search, advertising and content. On that level, the addition of mobile search and a concerted effort to make money from AOL content on YouTube gives it the potential to be a better deal. Through the first half of 2010, AOL has made $209 million from the current Google partnership. The companies also won’t confirm if some income is guaranteed but it would be surprising if guarantees against performance levels aren’t part of the deal.”
Tags: advertising, AOL, Google, partnership