In the latest move to topple Google as king of the online advertising hill, Microsoft announced Friday that it has acquired advertising strategy firm Rapt.

The deal, whose terms were not disclosed, gives Microsoft a company with a list of blue chip media clients, including Dow Jones, MTV Networks, Fox Interactive, NBC Universal, Reuters. The service also is used by Microsoft itself.

Rapt competes against companies like Zilliant in using algorithms to help companies price their web site display ads.

Backed to the tune of more than $40 million, two of Rapt's three co-founders got into a 2006 legal tussle with backers, Accel Partners and Levensohn Venture Partners. Co-founders Adam Galper and Paul Dagum sued the venture firms, along with Tom Chavez, current chief executive and the third co-founder, for breach of fiduciary duty and fraud in a case that was reportedly settled less than two weeks later.

Arthur Patterson, founding general partner at Accel, served as chairman of Rapt, while Christopher Sheeling of Levensohn also had a board seat.

Both Mr. Galper and Mr. Dagum exited Rapt. Mr. Galper became CTO/vice president engineering at Xtime, while Mr. Dagum became chief scientist and strategy officer at Business.com.

Decade-old Rapt will be folded into Microsoft's Atlas Publisher Suite, part of the company's Advertiser and Publisher Solutions Group. The company, whose annual revenue is estimated at $18 million by the Gale unit of Cengage Learning, is a former Red Herring 100 finalist.

San Francisco-based Rapt seeks to help companies segment their advertising inventory and create multiple pricing tiers to help them maximize revenue.

Microsoft's latest purchase comes just two days after Google closed its $3.1 billion acquisition of online advertising firm DoubleClick after clearing muster with European regulators.