FTC Approve Google-DoubleClick Deal

AP Business Writer Christopher S. Rugaber reported today that the five-member U.S. Federal Trade Commission (FTC) approved Google Inc.’s $3.1 billion purchase of DoubleClick Inc. by a 4-1 vote. Over the past months this proposed acquisition by Google was being scrutinized to determine whether it would violate antitrust laws by unfairly stifling competition.

It appears that the FTC agreed that Google’s online ad sales business does not compete with DoubleClick’s ad-serving technology. The FTC analysis determined that “the companies are not direct competitors in any relevant antitrust market.”

While this deal cleared U.S. hurdles rather easily, a similar investigation is underway in Europe. The European Commission must approve of the purchase or it cannot be completed as proposed. They have given themselves until April 2, 2008 to complete their review.

Google’s proposed acquisition of DoubleClick was first announced in April 2007. The reasoning laid out for the purchase, according to Rugaber, was that it would “combine Google’s leading position in online text ads with DoubleClick’s ad-serving tools that help publishers place and track display ads.”

Opponents like Microsoft and AT&T oppose the purchase and feel that Google and DoubleClick’s services do overlap in a way that gives Google a dominant share of the online advertising market. Many privacy advocates like the Center for Digital Democracy and the Electronic Privacy Information Center are concerned about the huge concentration of data under one roof that can be used to track individuals.

In addressing privacy concerns, the FTC clarified that they only have the legal authority to block the deal on antitrust grounds. However, the FTC appeared to at least partially agree that privacy issues are a real concern. Suggesting privacy issues “clearly transcend” this particular deal, the FTC proposed a set of “privacy guidelines” for the online advertising industry as a whole.

Most privacy advocates, however, do not feel such guidelines alone are sufficient. It is interesting to note why the lone dissenter, Commissioner Pamela Jones Harbour, did not vote in favor of the purchase. She dissented “because I make alternate predictions about where this market is heading, and the transformative role the combined Google/DoubleClick will play if the proposed acquisition is consummated.”

It will be interesting to see what stand European regulators take on this proposed acquisition since their authority may extend beyond that of the limited scope of the FTC.

About Mike Allen

Founder of Shopping-Bargains, a coupon and deal source featuring nearly 5000 merchant partners in the US (plus sites for the UK and Canada too). Recipient of the Affiliate Summit Pinnacle Awards 2009 Affiliate of the Year. Learn more about my 15+ years in affiliate marketing and my other projects at Businesswright Consulting. You can find me on Twitter: @mta1.

One Response to FTC Approve Google-DoubleClick Deal

  1. geri says:

    We may well regret that this ever happened… This dwarfs the FCC media concentration rules… This is scary, at best.