WPP has beaten Microsoft to buy global digital marketing agency 24/7 Real Media in a deal valuing the company at $649m (£329m).

The deal comes months after WPP's rival Publicis Groupe bought US digital and direct marketing company Digitas for $1.3bn (£660m) and Google acquired Double Click for $3.1bn (£1.57bn).

Today WPP said its cash purchase of 24/7 Real Media - at $11.75 a share - would enhance its position in search marketing and digital media.

"Our clients and therefore our industry are becoming more media and technology driven," said Sir Martin Sorrell, the WPP chief executive.

"24/7 Real Media significantly enhances our capabilities, technological resources and talent, as well as adding to our geographic coverage and our measurable skills."

WPP said that online advertising would exceed $33bn in 2007, or more than 8% of global advertising spend.

The 24/7 Real Media businesses will continue to be run by its existing management within WPP, as part of WPP Digital.

24/7 Real Media is based in New York and operates in 12 countries in North America, Europe and Asia-Pacific. It was founded in 1995 and employs more than 400 people.

Sir Martin's acquisition of 24/7 Real Media comes after he raised concerns over Google's purchase of Double Click.

"I think the Double Click acquisition clearly raises some regulatory issues which a number of media owners, publishers and competitors like Microsoft are very exercised about," Sir Martin said recently.

"Google is a short-term friend and a long-term enemy and probably the shorter term just got a little bit shorter and the longer term got a bit closer as a result of the DoubleClick acquisition."

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