Zillow and Trulia, two competing online real estate listing services, are now joining forces to create one online real estate listing database behemoth. Both services provide current listings on single-family and multi-family properties that are represented by agents and brokers. Uniquely, Zillow offers users the preference to search for properties labeled as “For Sale by Owner.”

Zillow has agreed to purchase Trulia in a $3.5 billion all-stock deal. While the announcement for the deal was made this past Monday, the merge will complete next year. Both Zillow and Trulia will maintain their names and respective websites. The two companies will also retain their CEOs – Pete Flint of Trulia and Spencer Rascoff of Zillow.

The most significant driving factor behind the deal is the advertising revenue generated by both services. Zillow and Trulia thrive through their placement of ads on their websites. Crucially, in regards to real estate marketing, “the combined revenue of both companies represents less than 4% of the estimated $12 billion that real estate professionals spend on marketing.” The boards of both companies hope that a combined service will be an enticing model to showcase advertisers.

Source: http://www.usatoday.com/story/money/business/2014/07/28/zillow-trulia-acquisition/13260727/