Nov 14
EU Opens In-Depth Investigation of Google’s DoubleClick Purchase
Brussels – Nov 13, ‘07 — European Union regulators started an in-depth investigation into Google’s plan to buy DoubleClick Inc., saying the purchase may hurt competition for online advertising dollars.
The European Commission, the EU’s antitrust authority in Brussels, said in a statement today that it will review the $3.1 billion acquisition for 90 working days and make a ruling by April 2. Google announced the proposed purchase in April to bolster sales of Internet ads that include pictures and videos.
An in-depth EU probe sets the stage for a wider fight over the deal, which is already under scrutiny in the U.S. after competitors including Yahoo! Inc., Microsoft Corp. and AT&T Inc. expressed concerns that the combination would hurt competition in the $40.6 billion global online advertising market. Other groups have complained that the combination may harm consumers’ privacy.
The inquiry is one of the few major business challenges that Google, the dominant Internet search engine and a stock market favorite, has encountered in its nine years. The company makes most of its money from text advertisements that appear next to search results and on partner sites, while DoubleClick, a privately held company, places banner ads on Web sites and sells analyses of who sees them.
In Brussels, many of the mounting objections filed to the commission in recent weeks centered on privacy issues, rather than questions about how a Google-DoubleClick merger would affect competition. A commission spokesman said that by law the EU inquiry could not make an antitrust decision on anything but its market impact.
BEUC, the umbrella group of European consumer organizations, as early as July had complained to the commission that the DoubleClick takeover would damage privacy rights and limit Internet content. Others joining BEUC included the European Publishers Council and the World Federation of Advertisers.
Their concern revolves around the information that Google and DoubleClick collect about the demographics of Internet users as they go from site to site. Most of the information is generic description that cannot be used to identify an individual, but some of it can. More at European Commission.