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Google, AOL Expand Alliance

Google and AOL Tuesday announced an expansion to their strategic alliance which will create a global online advertising partnership, expanding on the original relationship launched three years ago. The deal included a $1 billion investment in AOL by Google.

Among features of the expansion, Google and AOL will collaborate in video search and showcase AOL’s premium video service within Google Video, in addition to continuing to provide search technology to AOL’s network of Internet properties worldwide.

Google will invest $1 billion for an effective 5% equity stake in America Online, Inc., and become the only shareholder in AOL other than Time Warner. Additionally, Google, AOL and Time Warner may choose to expand the new partnership to Time Warner's other advertising opportunities. Other financial terms of the agreement were not disclosed.

Google CEO Eric Schmidt said, “Today’s agreement leverages technologies from both companies to connect Google users worldwide to a wealth of new content.”

Time Warner Chairman and Chief Executive Officer Dick Parsons said, “A critical piece of this strategic alliance will be our content, which we will be making more accessible to Google users.”