Google-DoubleClick merger deal finally goes through

After months-long delay, search titan Google has finally received green signal from the US Federal Trade Commission (FTC) for its controversial $3.1 billion acquisition of fellow online advertising firm DoubleClick.

The commission, which had been reviewing the proposed merger for eight months for possible antitrust violations, on Thursday, approved the Google-DoubleClick merger in a 4-1 vote, concluding the companies are not direct competitors in any relevant market.

In its public statement, the FTC said, "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."

The online advertising and internet search giants Google in April announced it would be purchasing Web advertising tools provider DoubleClick Inc. for $3.1 billion, in order to pace up its push into the graphic ad market by acquiring the software for creating and assessing Internet advertising campaigns.

But, concerned with the proposed deal, three notable privacy groups that same month urged the FTC to halt the merger on privacy grounds, contending the deal is a threat to privacy rights.

The Electronic Privacy Information Center along with the Center for Digital Democracy (CDD) and US Public Interest Research Groups (US PIRG) had filed the complaint in April with the U.S. Federal Trade Commission, alleging that Google and DoubleClick aggregate exhaustive personal data on consumers using the Internet but don't adequately protect the privacy of that information.

The trio had urged the FTC to investigate and block the deal, arguing the merger would violate agreed limits on how much data advertisers collect on consumers and seeking an injunction.

However, the FTC said yesterday that after carefully examining the evidence, “we have concluded that Google's proposed acquisition of DoubleClick is unlikely to substantially lessen competition."

Google, the provider of the most-popular search-engine, can still not formally close its DoubleClick acquisition until it gets clearance from European regulators. The European Commission is expected to reach their findings on April 2, while the Australian Competition and Consumer Commission have already approved the deal in October.

"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."

Google’s DoubleClick acquisition comes on the heels of a few similar deals from rival companies.

Internet giant Yahoo Inc. has completed in September its first business arrangement with a social networking site, Bebo Inc. The deal with Bebo allows Yahoo to sell display advertising for the social networking site in two countries where it is immensely popular, U.K. and Ireland. Site traffic data from comScore Networks Inc. shows 75 percent of Internet users in these two countries use Bebo.

Adding more to its efforts to become a stronger competitor in the fight for online advertising revenue, Microsoft in May said it agreed to buy online-ad company aQuantive of Seattle in a deal worth about $6 billion or $66.50 a share. The all-cash transaction, Microsoft's largest acquisition ever, was completed in August. Recently Microsoft has cemented an Internet advertising and content partnership with the US media conglomerate Viacom Inc., under which the two companies will provide about $500 million in services to each other over five years.

In order to expand itself in the advertising section and capture a monster share of online advertising, Google first bought DoubleClick, which Microsoft also tried to acquire, for $3.1 billion. In June, the Internet powerhouse announced that it has acquired FeedBurner, a Chicago-based privately-held company that provides media distribution and audience engagement services for blogs and RSS feeds.