Google launches display ad exchange

The $3.1B DoubleClick acquisition culminates in AdSense for image and video

Today, most display advertising is still negotiated "manually"--publishers and advertisers talk directly to each other to work out their deals. That's largely because the increased complexity of display over text coincides with increased cost, greater concern for context, and bigger hurdles to automation.

Last night, Google announced that it is integrating DoubleClick, the display advertising company it bought three years ago for $3.1 billion, with its Adsense and AdWords technology for matching publishers and sellers. By doing for display what it did for text ads, Google hopes to "grow the display advertising pie for everyone."

Google says it has three objectives: to simplify the system for buying and selling ads, deliver better performance to advertisers and democratize display advertising, making it easier for small businesses run campaigns. It'll probably do all three, and reap a boatload of money in the process.

Maximizing revenue for publishers and performance for advertisers is a worthy endeavor at a time when online ad growth has slowed significantly, putting the breaks on all those ad-based businesses birthed in the last 10 years.

Google also recently announced that AdSense would allow outside certified ad networks to bid for display ad space in its own system. It has integrated with 40 other ad networks, including 25 of the biggest ones in the U.S., and growing.