International: Google Completes Merger of DoubleClick

International: Google Completes Merger of DoubleClick

Author | Source: Advertising Age | Thursday, Mar 13,2008 8:04 AM

International: Google Completes Merger of DoubleClick

WASHINGTON ( -- Google today completed its $3.1 billion purchase of DoubleClick, acting shortly after the European Union gave its final approval to the deal that combines the world's largest search marketer with the world's largest ad-serving company.

"We are thrilled that our acquisition of DoubleClick has closed," said Eric Schmidt, Google's chairman-CEO. "With DoubleClick, Google now has the leading display-ad platform, which will enable us to rapidly bring to market advances in technology and infrastructure that will dramatically improve the effectiveness, measurability and performance of digital media for publishers, advertisers and agencies, while improving the relevance of advertising for users."

U.S. and Australian authorities had already approved the deal.

No 'competitive restraints'

The EU rejected calls from privacy advocates, as well as rival Microsoft, that it impose conditions on the deal, saying it was unlikely to have harmful effects on consumers or competitors.

"The Commission's in-depth market investigation found that 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," the EU said in a statement.

"Even if DoubleClick could become an effective competitor in online intermediation services, it is likely that other competitors would continue to exert sufficient competitive pressure after the merger," the EU went on to say. Google executives were meeting with reporters in their New York office this morning when the official news came through.

"There's a big world of brand and display dollars we haven't been as aggressive in or played in," Penry Price, VP-North America sales for Google, said at the meeting. He suggested that DoubleClick's former private-equity owners had underinvested in the Dart for Publishers ad-serving platform. "We want to build on top of that platform and create next-generation tools to work with marketers and agencies to have an end-to-end solution from planning to reconciliation."

Talk of an open platform

Google and DoubleClick "haven't had much dialogue about product integration," Mr. Price said, due to the regulatory hurdles. Google executives said they envision the DoubleClick platform to be open so that any developer can work on it. "We'd love it to be an OpenSocial for advertisers," Mr. Price said, referring to Google's collaboration with attempts to create an open platform for social-media application development.

Google has lagged in display advertising because it hasn't accepted third-party ad serving, such as DoublecClick or Atlas, which is now owned by Microsoft. Because Google now owns DoubleClick, that part of the business is expected to pick up substantially.

"I think would we be disappointed in 2008 and 2009 if we don't have a very significant presence in the display marketplace," Google President-Advertising Tim Armstrong said yesterday at the Bear Stearns Media Conference.

Mr. Price didn't say if Google would make free the use of its ad-serving technologies, as many have suspected, in an attempt to gain customers. He said current contracts that publishers or advertisers have with DoubleClick "won't be interrupted."

Privacy advocates had opposed the deal, arguing that it would give Google too much access to profile what users did on the web.

Lessening consumer control over data

Today, Jeff Chester, executive director of the Center for Digital Democracy, said the move will lessen consumers' control of their own information and push Microsoft to move forward with its bid for Yahoo.

"By failing to impose safeguards, EC regulators have helped strengthen a growing digital colossus that will now be in a dominant position to shape much of the global future of the internet and other online media," he said, adding it represents a failure of antitrust regulators to understand the impact of consolidation on data collection.

Microsoft had no immediate comment.

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