The search giant is aiming to invest up to $1bn in a local content company to help its online advertising revenue grow, according to sources familiar with the matter.
Google would be buying the Los Angeles-based local content development company, which has a long-standing focus on working with publishers to create digital and offline advertising campaigns, the sources said.
Google declined to comment on the sources’ claim.
Google has invested in other local content companies in the past and previously paid for the development and launch of its own ads, including for a number of major publications in the UK and across Asia.
The company has been working with the LA-based website designer, iDoneThis, to help develop and launch its local advertising platform, which currently has around 600 ad campaigns across 12 cities across America.
It would be paying around $100m a year for advertising across the US.
“This is a very different environment to other companies and will open new doors,” the source said.
“Its going to create a lot of great jobs and a lot more people will be getting more exposure.”
According to the sources, the LA company has the potential to create $10m in annual revenue from a business that is now struggling to attract revenue.
Google is also building a new advertising technology, Adsense, which it will test for advertisers on Google Plus and other social media platforms before rolling it out globally.
The source said the LA firm will also create a global advertising platform with which to build out the business.
“This will create many local advertisers who will be able to reach their audience across their own networks, which will make it easier for companies to scale and attract new advertisers to their sites,” the person said.
Advertisers may be asked to pay $20 a month for their service, which would be included in Google’s Google Play and Android apps, for three months.
The business could attract between 200 and 500 advertisers a day.
It is believed the LA site designer has worked closely with Google on its advertising business, which is based on Google’s ad targeting systems.
The website designer was founded in 2009 and is owned by a group of former Google employees.
Google purchased the Los Angeleno-based site designer for $20m.
The LA-born website designer currently runs iDoneIt for publishers and other online businesses and will continue to work with them, the source added.
“iDoneIt will remain open for independent ad targeting, which could be a new revenue source for advertisers,” the people said.
This story originally appeared on News.au