Popular online search engine Google won a key new customer Wednesday, America Online, the world's largest Internet access provider.
The deal is a coup for the fast-growing Mountain View company, which will provide searches for AOL's 34 million members. But even more important for Google, the valley's best-known private company, the deal turns Google into a key player in the paid-search business, about the only form of online advertising that still makes money.
Google is widely expected to go public within the next year and has been expanding its business strategy beyond non-commercial search. In February, Google began syndicating its pay-for-placement service, which allows businesses to place links alongside regular search results.
Google first snagged Internet access provider EarthLink from paid-search leader Overture Services, and dealt Overture a second blow Wednesday by taking its AOL business away. Overture's stock fell 35 percent to $21.99 Wednesday.
The multi-year deal only intensifies the turf battle between Pasadena-based Overture and Google. Last week, Yahoo signed a three-year deal to make Overture its paid-search partner, but Google continues to provide Yahoo with other key search services, at least until June when the contract expires. Overture has also sued Google, alleging patent infringement.
News source: SiliconValley.com