Reports: Google To Buy 5% Of AOL

  • December 19, 2005
Reports surfaced late last week that Google would buy a 5 percent stake in AOL for $1 billion--a move that solidifies the relationship between the two companies while dashing Microsoft's hopes of bolstering its fledgling search engine with AOL's traffic. The deal, if approved when the Time Warner board meets this week, means that Google will continue to power AOL's search engine for at least five more years; the pay-per-click revenue from those searches alone currently accounts for an estimated 11 percent of gross Google revenue. The deal also reportedly involves AOL selling ads to be displayed on publisher sites within Google's AdSense network. The combination of Google and AOL potentially creates an online advertising juggernaut. Last month, Google drew 85.5 million unique users and AOL drew 74.3 million uniques; combined, they far overshadow the previous leader, Yahoo!, which garnered 103.8 million uniques. -- Wendy Davis

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