US Approves Google’s DoubleClick Purchase, EU Still Reviewing

The American Federal Trade Commission voted 4-1 yesterday to allow Google to proceed with its $3.1 billion bid for advertising rival DoubleClick. The FTC said “because the evidence did not support the theories of potential competitive harm, there was no basis on which to seek to impose conditions on this merger.” The European Union isn’t so sure, and it may not act one way or the other until April 2, 2008. One must, in the interests of fairness, remind readers that the Kensington Review uses Google to generate its ads.

Google’s bid is based on its desire to enhance its capacity to tailor ads to web surfers’ activities. For all of their brilliance, the guys at Google just weren’t making that much progress on display ads; they do search ads. DoubleClick may not have the segment locked down, but it has relationships with most of the big online publishers and around half of the ad agencies. As a result, Google is prepared to pay $3.1 billion for a firm with revenues of $150 million.

Another reason for Google to make this bid is to keep DoubleClick out of Bill Gates’ hands. Microsoft isn’t doing a bang up business in searches, and it appears to be declining when measured by hits. Then again, on-line advertising is peripheral to what Microsoft does. To Google, it’s the core business.

The EU isn’t really all that worried about the competitive issue. The concerns there stem more from privacy. Sophie in 't Veld, a Dutch member of the European Parliament who sits with the liberals, said, “There are lots of companies collecting personal data; we volunteer our personal data to get services. This is something many citizens are not aware of. Who is the owner of the data, what can public authorities do and not do, what kind of legal protection do people have when they use Google and Gmail? The Internet is not anonymous. It is possible to know a lot about us, where we are and what we are doing.”

Now that the US has approved the deal, the EU will probably get assurances from Google that it won’t do X, Y or Z. Then, the purchase will probably be approved. In the meanwhile, one can look forward to lawsuits from the Electronic Privacy Information Center (EPIC), the Center for Digital Democracy (CDD), and the US Public Interest Research Group.

© Copyright 2007 by The Kensington Review, Jeff Myhre, PhD, Editor. No part of this publication may be reproduced without written consent. Produced using Fedora Linux.

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