Congratulations, Madison Avenue: only four years too late. WPP, a marketing conglomerate which was burned by overpriced internet investments in the late 1990s, has woken up to the resurgence of online advertising. Martin Sorrell's group — which owns agencies J Walter Thompson, Ogilvy & Mather and Young & Rubicam — has agreed to pay $649m for one of the last remaining independent online ad networks. The deal, for 24/7 Real Media, is the biggest acquisition by a traditional advertising company during the latest internet upswing. We're also hearing that WPP is negotiating to buy Schematic, a Los Angeles digital design shop. That transaction would be worth about $40m upfront, rising to about $100m if Schematic managers meet targets.

What do this acquisition drive mean? First, if there was any doubt, it marks Madison Avenue's recognition that online advertising will only grow at the expense of television and print, their mainstays. Martin Sorrell, boss of WPP, is the most progressive of the advertising moguls; WPP has always been quick to follow fashion, investing, expensively, in companies, such as Peapod and Syzygy during the last boom. Now the memory of those deals has faded, and Sorrell's returned, one can expect other Madison Avenue conglomerates such as Omnicom to follow.

Second, Microsoft, which allowed WPP to win the bidding for 24/7, is left without a dancing partner. That will probably be taken as a reverse for the Redmond software giant, which has struggled to develop an internet advertising business. But 24/7 is an also-ran among the online advertising middlemen. It would have been no more than a consolation prize for Microsoft, after the company lost Doubleclick to Google.

Third, none of these deals really matter. Google's acquisition of Doubleclick was the important combination, because it marries the search engine's huge advertiser base with online publishers who "serve" ads using Doubleclick's service. Yahoo's acquisition of the shares in Right Media it didn't already own, and the sale, now, of 24/7, are reactive transactions. There's only room for one giant exchange for online advertising; the smart money should be on Google.