About 10 hours ago Google announced that they have agreed to acquired DoubleClick for $3.1 billion in cash (nearly double the size of their YouTube Acquisition which was in stock).

This is bad news for Microsoft has they now fall even further back in the online advertising race. DoubleClick’s $300 million turnover a year will help Google further cement their place as contextual advertising leaders.

�Keeping Microsoft away from DoubleClick is worth billions to Google,� an analyst with RBC Capital Markets, Jordan Rohan, said.

For months, Google has been trying to expand its reach in online advertising into display ads, the area where DoubleClick is dominant. Google still generates most of its revenue from search and contextual text ads.

The news wasn’t received too well by the stock market - shares are trading down a buck a share. Only time will tell if this acquisition has a positive ripple effect on the Google shares.

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