UPDATE: PayPerPosts’s purchase only involves the stat tracking software, and not the ad network after all. Thanks to Nick and Clickz for clearing it up.

Mike Arrington has scooped things yet again with a news item that will no doubt dominate the blogosphere in some way for the next day or so — PayPerPost, once the bane of ethical bloggers everywhere, has bought out Performancing.com. As a recap, Performancing.com offers a free stats package to bloggers (that I’ve never really liked; its always gotten the titles wrong on my installation), a free Firefox plugin that allows you to edit posts and start new posts directly to your blog, but most importantly, the new Performancing Ad Network.

This was launched in a beta form some months ago, and it allowed bloggers to sign up and essentially sell ad space on their blog, matching ad buyers with prospective bloggy sellers of ad space. The breakdown, for the truly interested, is around 70/30, with bloggers getting 70% of the ad revenue sold on the ad network, and 30% going back to Preformancing.

So, let’s get back to the deal. What does the deal all mean?

Well, the details are forthcoming with a press release tomorrow — but irrespective of how much PPP paid for Performancing, there are some interesting inferences one can make, and I think they all have to do with Performancing’s Ad Network.

1) PPP has purchased lots of potential bloggers for its own network: This is the most obvious, but their purchase just bought them even MORE bloggers into their fold; more potential bloggers for them to blog about their publishers, means more dollars in their own pocket, and obviously plain ol’ growth. But that might not even be the most important part — not by far.

2) PPP has acquired in-the-door relationships with many more prospective purchasers of PayPerPost “Opportunities” : The number of potential bloggers they could bring into the fold is nice, but the real news is how many publishers that they’re also now actively courting. What do I mean? Only that the demand for bloggers to be paid to blog probably far outpaces the amount of bloggable inventory. How’s that? Well, if you’re ever wondering how active their own network of bloggers is, just check out how “active” their forums are, and more importantly, how “active” the post is on “the one that got away” to give you an idea of how hungry these guys are looking for the work. PayPerPost might need bloggers — but I suspect they are probably MORE interested in publishers who have giant ad spending budgets. Performancing’s purchase doesn’t automatically get them more advertisers, but it does get them the opportunity to get more advertisers — and I suspect to Performancing, who has an eye on growth, that’s vital.

3) PPP has just acquired some (more) legitimacy through its Performancing’s own blog and bloggers: Performancing has an active blog on its own. Nick and Chris in their own right have a great blog, although in recent months it has seemed to focus on getting Performancing’s Ad network just right. i don’t know if the Performancing purchase means that Nick Wilson will be staying on to blog — but if he does, it ads instant credibility to PayPerPost. That’s not to say that things written will be all sunshine and roses, but Nick Wilson’s a smart guy, and with all of the initially negative publicity on PayPerPost, getting him and his blog on board is going to be important.

4) PPP has expanded their own offerings to allow publishers more varied offerings than merely “pay per post”: PPP focuses on selling “Opportunities” to create word of mouth advertising, which is fine and good; clearly with Performancing’s own ad network, they have the opportunity to offer much more than that. They can sell traditional ad space in an established marketplace with buyers and sellers of that ad space. Once integrated into their own system, they’ll have the opportunity to create a more full-service outfit that can offer a more diverse set of “opportunities” to bloggers and advertisers alike. They’ll need to commit capital and manpower to get it all up and working, but again, if the eye is on growth, this is nothing but a good thing.

I expect this announcement to be huge. The year has been a big one for PayPerPost, with all of the hoopla surrounding the issue of disclosure that I, myself, have blogged about once or twice. However, since their mandate to force all bloggers to disclose (albeit following an official statement by the FTC suggesting that people who do NOT disclose might face penalties), I think that PPP, along with ReviewMe and CreamAid have long since gone past the idea of whether or not pay-for-posting is ethical — because “blue-collar” bloggers have happily picked up the cause and have run with it. The idea that purity of blogging shouldn’t be sullied by paying for posts has gone from outrageous to quaint in only a matter of months.

Again, if there is any question on the popularity of this, do yourself the favour of actually monitoring the blogosphere; the vast majority of bloggers are actually talking about positive things about pay per post — mostly because it offers them cash for something many of them feel they’d do “anyway”. Many of these bloggers like being paid irrespective of how it makes them or their blog look because bloggers like money and gifts. The concept of “selling out” is a non issue. Its that simple. And fighting that basic truism, no matter how true it may be, is ultimately useless. At the end of the day, despite all that gnashing of teeth, beating on the chest, and proud proclamations of purity, it will ultimately make no diffreence at all.

And PayPerPost, ReviewMe and Creamaid are going to reap the benefits.

Yes, with advertisers now having the mechanism to manipulate what bloggers say as part of the blogospheric reality, it seems like PPP has taken the next step past the PPP debate. The purchase of Performancing.com will allow PayPerPost to bring even more legitimacy to itself by bringing some traditional advertising mechanisms, advertisers, and bloggers into the fray — both as a new way to grow itself as an advertising marketplace, AND a way to evangelize the concept of pay-per-buzz by blogging.