Google plans to acquire Web analytics provider Urchin Software to complement its advertising and publishing products.

JupiterResearch analyst Eric Peterson speculates there are several possible scenarios for Google going forward. The first, and most likely route, would be to follow Yahoo!’s lead and integrate the Urchin technology into its AdSense tools. (Overture integrated Keylime into its Marketing Console after buying it for $9.5 million in 2003.)

A second option would be to follow the model it uses with Picasa and give away Urchin “as is.” The goal there would be to help make Web sites more effective and improve Google’s own organic search results.

A third option, which Peterson says could strike terror in the hearts of Google competitors, would be for Google to use Urchin technology to create a free, tag-based analytics solution. That move would likely force lower prices from large vendors, and threaten the existence of smaller ones, he said.

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