Taking its fierce competition with Yahoo to a new level, search engine giant Google recently acquired Silicon Valley's display ad technology firm Teracent, which is still a start-up, and the move will now put it right next to Yahoo, which had till now ruled the display advertisements sector. The acquisition has been confirmed by Google in a post on the company's official blog.

"Teracent's technology can pick and choose from literally thousands of creative elements of a display ad in real-time -- tweaking images, products, messages or colors. These elements can be optimized depending on factors like geographic location, language, the content of the website, the time of day or the past performance of different ads", said the post.

As a prototype, Google displayed an advertisement for a Home Hardware store, and when combined with Teracent's technology, it was more detailed and showed user friendly information like specials on exact products available, pictures of products and location information.

Online advertisements are divided into text and display searches. While text ads are related to content on a particular website, display ads, banner ads for example, are often used as branding tools by advertising companies.

The deal, which has been confirmed by both the parties involved, is expected to close by the end of the year.