Conversely, short-sellers of the stock argue that advertising is failing as a business model on the Web. Those conflicting opinions make for a lot of volatility. Abacus, based in Broomfield, Colo., has amassed actual customer purchase information, by far the most valuable kind of data for marketers to have on consumers. Its database, compiled mostly from information from catalog companies, has histories on about 3 billion transactions. Prior to the acquisition, which was announced on June 14 and is expected to be completed in October, DoubleClick's own database had amassed information on where consumers were spending time online and if they had indicated intent to purchase services or goods.
Many investors are skeptical about combining online and offline companies.
Not only will DoubleClick have to struggle with technical issues but it will also have to deal with concerns that targeted advertising violates consumers' right to privacy. DoubleClick could get a boost out of the red from Abacus. Boyle points out that Abacus has hefty profit margins and is growing quickly. And it has to do all this while integrating its acquisition of NetGravity, which sells adserving software to Web sites. But doing two such large transactions so close together will be a challenge, says Boyle.