Google's purchase last year of dMarc Broadcasting, a broker for radio ads, signalled that the search engine's ambitions went way beyond internet advertising. It was also the search company's first 10-figure acquisition. Except it wasn't. Google only paid $102m in cash; the remainder was tied to revenue and other targets, such as the merger of dMarc's radio ad marketplace with Google's Adwords system. Of $1.13bn in earn-out, dMarc's disgruntled management and investors will be lucky to see $200m, says a person familiar with the company. To blame? Among other things, a clash between the salesmanship required in radio advertising, and Google's fetish for automation. A tipster explains.

Google has not wanted to roll-out human sales folks to pitch, explain and train the automated radio buying tools to advertisers and radio buyers, believing instead that the self-service tools will sell themselves and the buyers will just come. Google's 'product is king' philosophy is that sales people just pick up check and service customers, they are not really needed to generate the business, products do that. This has significantly suppressed the sales that the dMarc folks had expected to be able to generate. Lack of this demand creation is one of the reasons that Google has not been able to be aggressive yet in acquiring radio inventory (without orders, it is all "risk" buying). Word is that the dMarc folks will be lucky to pick up $150-200m of the earn-out potential). The CBS deal, if it happens soon, might change things, but the dMarc folks are not feeling very loved.

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