According to CNET, Google Inc. (NASDAQ: GOOG) continues to make smaller but strategic acquisitions in order to make its successful advertising platform as pervasive in every medium as possible. In that vein, the Internet search giant has acquired AdScape Media in order to get into advertising in modern gameplay, from gaming consoles to those neat, time-killing games found on almost every cellphone these days.

The costs to develop and produce a modern video game can be as high as some feature films made in Hollywood. AdScape Media and now Google are creating plans to make the games accessible (price-wise) to as many gamers as possible using advertising subsidies like network television or Internet portals generally do.

AdScape's charge is to "honor the game that was developed and find new ways to enable that game to continue so others can enjoy it." That means injecting relevant advertising into the gaming medium to allow game developers, publishers and artists to continue crafting and selling those all-too-realistic games into the modern entertainment mainstream. With the Google acquisition, it seems like just another feather in the cap of the company that wants to become the largest and most relevant advertising firm the world has ever seen.

MAJOR PAPERS:

• According to the Wall Street Journal (subscription required), citing people familiar with the matter, Community Health Systems Inc (NYSE: CYH) is near a deal to purchase Triad Hospitals (NYSE: TRI), which would break up an existing $4.5B private-equity buyout plan.
• The Wall Street Journal's "Heard on the Street" column reported that rumors are swirling that Infineon Technologies ADS (NYSE: IFX) will be chosen to supply the main chip to drive the upcoming iPhone from Apple Inc (NASDAQ: AAPL).

OTHER PAPERS:

• The Business Standard reported that Reliance Industries is reportedly in advanced discussions with Nova Chemicals Corporation (NYSE: NCX), the plastics and petrochemicals firm, to form a joint venture.
• According to the U.K. Times, Barclays plc ADS (NYSE: BCS) will announce today its formal interest in buying Netherlands bank ABN Amro Holdings (NYSE: ABN) for a price of up to a little less than EUR60B, or EUR31.3 per share, according to reports.
• Dow Jones & Company (NYSE: DJ) is trying to buy the Financial News for GBP25M, the U.K. Times reported.
• The Sunday Telegraph reported that Coca-Cola Company (NYSE: KO) is planning a 'beauty tea' in conjunction with L'Oreal ADR (OTC: LRLCY), called Lumae.
• According to Google Inc's (NASDAQ: GOOG) official blog, it has acquired Adscape media. Terms were not disclosed.

MAJOR PAPERS:

• The Wall Street Journal's (subscription required) "Heard on the Street" column focused on Credit Suisse Group's (NYSE: CS) new CEO, Brady Dougan, saying the company chose him to hold a steady course, avoiding periods of high revenues followed by crashes.
  
• Barron's Online's (subscription required) "Weekday Trader" column wrote that Elizabeth Arden Inc (NASDAQ: RDEN) trades at a discount to its industry and the broader market, and looks enticing at current levels.

OTHER PAPERS:

• BusinessWeek's "Inside Wall Street" column reported that AMR Corporation (NYSE: AMR), the parent of American Airlines, is a buyout target of a group that includes the Goldman Sachs Group Inc (NYSE: GS).
• The New York Times reported that Congress has reintroduced legislation to allow the federal government to further regulate the tobacco industry by cracking down on marketing aimed at young people.
• The New York Times also reported that Microsoft Corporation's (NASDAQ: MSFT) CEO Steve Ballmer said Wall Street analysts are being too optimistic about sales of Windows Vista.
• According to the Red Herring, Google Inc (NASDAQ: GOOG) has acquired Adscape for $23 million.

According to a recent Wall Street Journal article (viewable on Moneyweb), Google Inc. (NASDAQ:GOOG) is in talks to acquire Adscape, a San Francisco company that provides technology for advertising in video games -- think Mario and Luigi in Lowes uniforms.

If the price is right, this looks like a terrific acquisition for Google, perhaps even a genuinely synergistic one. If they can get even a tiny percentage of the advertisers who shelled out nearly 10 billion dollars to Google for online advertising last year, Adscape's revenue will soar. For years, console games have featured ads, but they were programmed into the cartridge during the game design and could not change. With new systems like Xbox 360 and PlayStation 3 hooked up to the Internet, it is now possible for product placement in video games to change every day.

I'll be eagerly awaiting details of Google's probable acquisition of Adscape. As most investors know -- and shareholders in Lenox Group (NYSE:LNX) recently found out -- acquisitions seldom end well. Peter Lynch calls it "diworsification." But this one looks better than most.