December 20, 2007 7:24 AM PST

FTC allows Google-DoubleClick merger to proceed

The Federal Trade Commission announced Thursday that Google's controversial $3.1 billion merger proposal with DoubleClick can proceed, despite earlier complaints raised by competitors and privacy advocates.

FTC regulators had been reviewing the proposed merger for eight months for possible antitrust violations, after Google announced plans in April to acquire the online ad-serving company. The commission, in issuing its decision to let the merger move forward, said the companies are not direct competitors in any relevant market.

"The markets within the online advertising space continue to quickly evolve, and predicting their future course is not a simple task...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," according to an FTC statement.

The approval for the merger came in a 4-1 vote by regulators. In her dissent, Commissioner Pamela Jones Harbour said she was inclined to 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." She said she determined that the two companies' product markets overlap in key ways that could "substantially lessen competition" down the road.

Rivals such as Microsoft have challenged the merger, complaining that it would give Google an unfair advantage in search and publisher-based advertising tools.

Google, in its response to the FTC ruling, cited the merger's potential benefits for consumers.

"The FTC's strong support sends a clear message: this acquisition poses no risk to competition and will benefit consumers," said Eric Schmidt, Google's chairman and CEO. "We hope that the European Commission will soon reach the same conclusion, and we are confident that this deal will deliver more relevant ads for consumers, more choices for advertisers, and more opportunities for website publishers."

On Wednesday, Microsoft and entertainment media giant Viacom announced a $500 million advertising agreement that Google cited as evidence of a "highly competitive" market for online ads.

The search titan said it cannot formally close its DoubleClick acquisition until it gets clearance from European regulators, who are expected to announce their findings on April 2. The Australian Competition and Consumer Commission approved the deal in October.

Serving up ads
Both Google and DoubleClick have an ad-serving business, when defined in a larger sense. But when drilling down, the two companies operate in different segments of the ad-serving market.

Google's AdSense serves up to Web sites within its publisher network, offering up pay-per-click text ads that are generated from keyword searches, or based on the context of a Web site. DoubleClick, which markets a product called Dart to publishers, advertisers and corporate customers, places banner ads on Web sites. It also runs an advertising exchange, which matches advertisers and advertising networks with Web sites that sell ad space, and it operates search-engine marketing business Performics.

The FTC's decision to allow the Google-DoubleClick merger to proceed falls in line with actions over the past three decades, regarding nonhorizontal, or vertical, mergers. These mergers involve companies in adjacent businesses and are designed to push the buyer into a new market, whereas horizontal mergers involve two companies in exactly the same line of business and result in the removal of a competitor.

The commission evaluated the Google-DoubleClick under three nonhorizontal merger theories that examine potential harm to competition.

Under one theory, the FTC determined the two companies were not direct competitors and, as a result, would not eliminate substantial or direct competition between the two.

Second, regulators reviewed the merger to see if it would eliminate potential competition that would be beneficial. The FTC found that even if Google were successful in its efforts to enter the third-party ad-serving markets, there are a number of players in the industry and competition is likely to become fiercer.

CONTINUED: Capitol Hill reacts…
Page 1 | 2

See more CNET content tagged:
DoubleClick Inc., merger, regulator, advertiser, Google Inc.


Join the conversation!
Add your comment
I am glad it went through.

I hope that I don't regret saying this, because it is possible that Google could become evil in the future, but as it stands right now, they are the best company for DoubleClick.

If Microsoft got DoubleClick, then the end of the world would have been nigh.
Posted by t8 (3716 comments )
Reply Link Flag
... will "t8" et al come up with their own "Google" to GOOGLE GOOGLE (a better Google)! "If Microsoft got (had gotten) DoubleClick, then the end of the world would have been nigh".
Posted by Commander_Spock (3123 comments )
Link Flag
Benefits Consumer?
I often wonder: Is the consumer me? Is the consumer the businesses placing the ads? Personally, I dislike "double click," always have.
Posted by sixthromeo (49 comments )
Reply Link Flag
secret installs from google.
Posted by inachu (963 comments )
Reply Link Flag
Party Like It Is 1984 - Big Brother Is (Always) Watching. 8-) !
Posted by Commander_Spock (3123 comments )
Link Flag
Posted by tingsgardroces (2 comments )
Reply Link Flag
Posted by tingsgardroces (2 comments )
Link Flag
Clicked on "Super Anti Spyware"
Would you like a complete scan of your computer?



We have found 20786 instances of spyware, maleware, Adware and virus. Most pertain to Google and Double Click and to numerous to list.

Would you like "Super AntiSpyware" to delete all instances?



Could not delete "Google Home Page" You need to find another. Suggest you set to "blank" to avoid further infections.

Super AntiSpyware is finished
Posted by Ted Miller (305 comments )
Reply Link Flag
But For The "The Forests" (Microsoft & Google)...
... that we cannot see "The Trees" (IBM and OS/2PlEX): This article is soooooooooo..... insightful ("Microsoft in Denial: Google Threat is Classic Disruption") it is certainly worth reading, here is the link:

<a class="jive-link-external" href="" target="_newWindow"></a>

As to why some folks would use these products that has certain limitations is any ones guess. Why get on an "spaceship" that is only going to take you three-quarters of the distance that you have to travel. How in this universe are you going to be able to complete the rest of the journey? This is perhaps one of the reasons why those home-owners are going through the experiences that they are going through. IBM's Moon (Serenity Systems International and OS/2PLEX (OS/2's Programmers and Business Consultants) - the "Trees" will guarantee a splendid and complete (business class) journey at WARP SPEED rather than the "three-quarters way" Microsoft and Google-DoubleClick "turbulent rides". EXPERIENCE COUNTS/MATTERS. ;-) !



Posted by Commander_Spock (3123 comments )
Reply Link Flag

Join the conversation

Add your comment

The posting of advertisements, profanity, or personal attacks is prohibited. Click here to review our Terms of Use.

What's Hot



RSS Feeds

Add headlines from CNET News to your homepage or feedreader.