By David Lawsky 38 minutes ago
BRUSSELS (Reuters) -
Google Inc closed its $3.1 billion
acquisition of online ad delivery company DoubleClick Inc on
Tuesday, just hours after the deal won unconditional approval
from the European Commission.
The approval came despite objections from rivals and
privacy advocates and followed an in-depth investigation by
European competition officials. The merger, announced a year
ago, was given a go-ahead by U.S. antitrust authorities late
last year.
The European Commission, the European Union's executive
arm, said the companies operate in different parts of the
online advertising world and their deal was not a marriage of
rivals.
"Google and DoubleClick were not exerting major competitive
constraints on each other's activities and could, therefore,
not be considered as competitors at the moment," it said.
Google has by far the strongest position in Web searching
in Europe. That gives it an edge on the simple ads it sells,
which appear on its search pages.
DoubleClick deals with fancy display ads that it delivers
to many kinds of Web sites.
DoubleClick supplies the technology used in what is known
as "ad serving," which allows advertisers to target potential
customer and measure how well their ads are received. Its
services are a boon to Web site owners who fill the blank space
on Web pages with brand adverting delivered by DoubleClick.
Ad serving funnels the advertising of clients to one of
several ad networks, such as Google's AdSense, which act as
auctioneers connecting buyers and sellers of ads and ad space.
The Google-DoubleClick deal drew opposition from rivals
such as Microsoft Corp and Yahoo Inc.
The European Commission said once Google and DoubleClick
combine, they will still be unable to marginalize other ad
servers that have become attractive to big technology players.
The online ad industry rapidly consolidated last year.
Microsoft bought aQuantive for $6 billion, Yahoo bought
BlueLithium for $300 million, and Time Warner Inc's AOL unit
bought Tacoda for an undisclosed amount.
Privacy advocates complained that the Google-DoubleClick
deal would allow the companies to combine their different
methods of gathering information about the habits of Web
surfers.
The European Commission's statement sought to play down the
concerns, saying the deal was unlikely to have harmful effects
on consumers, at least in the markets it considered.
The commission and the U.S. Federal Trade Commission said
privacy was outside the scope of a competition review. The
commission's statement on Tuesday had nothing to say about
privacy.
One privacy advocate, the Center for Digital Democracy in
Washington, said the FTC and the European Commission must think
about the Web in a different way.
"U.S. and European policymakers must reform the antitrust
process to reflect the realities of the digital market era,
where competition, data collection and content creation are
seamlessly intertwined," it said in a statement.
(Additional reporting by Eric Auchard in San Francisco;
Editing by William Schomberg, Quentin Bryar and John Wallace)
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