Time Warner is selling a 5% stake in AOL to Google, which in return is giving AOL $1 billion in cash and, perhaps, a chunk of its soul. Here are three top takeaways from yesterday’s article in The New York Times:

AOL ads will get preferential treatment on Google. Search results will carry AOL-specific sections of links — including the AOL logo. It’s a huge question as to how intrusive these will be in comparison to paid AdWords placements. Will the mere presence of this new section of links drive AdWords clickthrough rates down significantly?

Microsoft will be a distant #3 in the search advertising world. For now. Lagging far behind Google and Yahoo!, MSN will need to hit a major home run with its impending demographic-based AdCenter launch to have hopes of closing the gap significantly. Gates and company have a lot of work to do.

AOL will be able to optimize itself for maximizing organic placement in Google’s pages. Here’s the salient tidbit from the Times: “Google will also provide technical assistance so AOL can create Web pages that will appear more prominently in the search results list.” Attention everyone who deals in SEO: Your job has just become that much harder.

The biggest takeaway, though, may be that Google — which has long prided itself on its independence, technology savvy, and customer focus — is taking a chance by so firmly integrating itself with AOL — which has long been seen as a set of Internet training wheels. In the words of author John Battelle, who wrote a book about Google: “What they are giving away is the perception in the market place that Google isn’t for sale.”

Of course, better for Google to align with AOL than to have to face off against a combined AOL and MSN. Ahhh, big business sometimes makes strange bedfellows.

This entry was posted on Sunday, December 18th, 2005 at 10:03 am and is filed under Internet Stuff, Marketing Stuff.