Adware makers 180solutions, Hotbar merge

New business is called "Zango" after 180solutions' ad-displaying software. The Hotbar Web browser toolbar will still be distributed.

Advertising software makers 180solutions and Hotbar announced Wednesday that they have merged into a new business called Zango.

Bellevue, Wash.-based 180solutions makes software, including its now-namesake Zango Search Assistant, that delivers pop-up ads as people perform Web searches. Hotbar, based in New York, offers toolbars with ad displays for Microsoft's Internet Explorer, Outlook and Outlook Express.

"The merger creates increased available inventory and an even larger audience of potential customers whom advertisers can target utilizing Zango's time-shifted ad-delivery model," 180solutions and Hotbar said in a joint statement.

As part of the transaction--in effect a takeover of Hotbar by 180solutions--82 former Hotbar employees will join the newly named company; another 40 people are joining Hotbar's founders in a new endeavor; and about 20 employees have been let go, York Baur, executive vice president of business development at Zango, said in an interview Wednesday.

In exchange for displaying ads, Zango and Hotbar give access to content such as videos, games and tools. Anti-spyware programs, however, typically flags both the Hotbar and the Zango software as "risky."

180solutions and Hotbar face increased consumer awareness and a crackdown on spyware by federal officials. Both companies have been involved in legal fights with security software makers over the designation of their products as malicious technology. An anti-spyware watchdog group has lodged official complaints against 180solutions.

Despite the opposition, the ad-serving companies have prospered, York said. "We have enjoyed 16 consecutive quarters of profitability," he said, declining to provide further details. Zango now has more than 200 employees, York said.

The new company will be headquartered in Bellevue and will continue to offer both the Hotbar and Zango products. Millions of people use those applications, according to Zango. Terms of the transaction were not disclosed.

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