THK agrees to purchase the blog search engine IceRocket from a group that includes Mark Cuban. The terms of the deal were not disclosed.
Cuban Sells Blog Search Engine
Blog searcher IceRocket looks to get into advertising by joining online marketing holding company Think Partnership.
April 13, 2006
Think Partnership, which owns a variety of ecommerce sites, said Thursday it plans to buy two-year-old blog search engine IceRocket from broadcast entrepreneur Mark Cuban.
Terms of the deal, which Think Partnership spokesman Xavier Hermosillo said he expected to close within 60 days, were not disclosed.
Shares of Think Partnership, formerly known as CGI Holding Corporation, were up $0.09 to $1.95 in recent trading.
The Northbrook, Illinois-based company recently sold $26.5 million of convertible preferred stock, netting $24.8 million, before buying Litmus Media in a half-stock, half-cash deal worth $13 million.
Combined with the company’s reported $2.6 million in cash at the end of 2005, Think Partnership should have about $20 million at its disposal for the IceRocket deal. Mr. Cuban was the sole investor in IceRocket.
“[Think Partnership] has a lot of revenue-generating tools; we’re wanting to bring that to the blogging world,” said IceRocket CEO Blake Rhodes, who will maintain his position.
He said IceRocket has “millions of users,” including a significant portion who subscribe to RSS (really simple syndication) feeds of searches. The 12-employee company has focused its recent efforts on updating techniques to eliminate spam blogs—or “splogs,” a term Mr. Cuban coined—from search results.
Ads on Blogs
IceRocket now looks to help tie bloggers to Think Partnership’s affiliate advertising resources, meaning it will have to compete with the dominant Google AdSense as well as blog advertising networks.
Mr. Rhodes said the genesis of the deal came from IceRocket’s existing partnership with Litmus. Litmus, which specializes in click fraud prevention in online advertising, powers IceRocket’s sponsored search results.
“Both of our companies are focused on providing the highest integrity services to our users and building core enabling technology that can eliminate click fraud and ‘splogging’ on our networks in real time,” said Mr. Cuban in a statement.
“IceRocket will provide Think Partnership with an innovative platform to help our advertisers leverage the rapidly increasing traffic generated by the popularity of blogs,” added Scott Mitchell, president of Think Partnership.
Growing Pains
The blog search market has gone through growing pains lately, with PubSub CEO Salim Ismail stepping down and a handful of employees leaving Technorati.
“As you move from being a science project to being a real company, there’s a natural attrition that occurs,” said Technorati CEO David Sifry.
Mr. Sifry called the IceRocket deal “a very validating thing for the blogosphere as a whole and for the value of search and discovery.”
Despite fear that entrance of the major search players would wipe out blog search specialists like IceRocket and Technorati, Mr. Sifry reported that his firm had 85 percent growth in the last quarter of last year, when both Google and Yahoo debuted blog search tools. Though he would not disclose the figures, he said page views and users were growing 20 percent month-on-month.
San Francisco-based Technorati makes money from advertising like most search engines, though it does not place contextual ads on blogs. The largest part of its revenue results from syndication deals with media outlets like Newsweek and The Washington Post to deliver discussion of their articles by the blogosphere.
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