EQUTE — Google is looking to the future of display ads, and acquiring Teracent is on step toward reworking and tweaking display ads.

Teracent customizes display ads by targeting ads to location, time of day, Web site content and keeps tabs on how recent ads performed.

The features will soon be available on the Google Content Network and for Doubleclick clients — allowing advertisers a slew of new options for ad targeting.

Google’s Neal Mohan, Vice President, Product Management and Joerg Heilig, Engineering Director wrote about the deal on the official Google blog.

We think that this technology has great potential to improve display advertising on the web. That’s why we’re pleased to announce today that we’ve entered into a definitive agreement to acquire Teracent. The transaction, which is subject to various closing conditions, is expected to close this quarter.

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Teracent’s technology can pick and choose from literally thousands of creative elements of a display ad in real-time — tweaking images, products, messages or colors. These elements can be optimized depending on factors like geographic location, language, the content of the website, the time of day or the past performance of different ads.

These new options will take some getting used to, but it could lead to a much better targeting once advertisers figure them out.