After an eight-month investigation, the Federal Trade Commission Thursday gave a green light to Google’s proposed $3.1 billion acquisition of online advertising concern DoubleClick.
“After carefully reviewing the evidence, we have concluded that Google’s proposed acquisition of DoubleClick is unlikely to substantially lessen competition,” the FTC said in a statement.
Competitors, in particular Microsoft, challenged the merger, claiming it would hurt competition in the online ad market.
However, the FTC implied that it doubted protecting a vibrant online ad marketplace was the sole motivator for Google’s competitors.
“At bottom, the concerns raised by Google’s competitors regarding the integration of these two data sets—should privacy concerns not prevent such integration—really amount to a fear that the transaction will lead to Google offering a superior product to its customers,” the FTC said.
The FTC added that Google’s competitors have access to unique databases of their own that will allow them to offer competing products.
The proposed deal still has to pass European regulators before it can go forward.
The European Commission—the EU’s antitrust authority—began investigating the proposed merger in November, saying the deal may hurt competition for online ad dollars. A ruling is expected in April.
Though some consumer activists urged the FTC to oppose the merger claiming that the integration of the companies’ two sets of data would pose an unacceptable threat to consumers’ privacy, the FTC declined, saying that any privacy threat DoubleClick and Google combined may pose is not unique to the two firms.
“To the contrary, these issues extend to the entire online advertising marketplace,” the FTC said in its statement. The FTC added this isn’t the first time it has been asked to intervene in a transaction because of concerns unrelated to anti-trust.
“Although such issues may present important policy questions for the nation, the sole purpose of the federal antitrust review of mergers and acquisitions is to identify and remedy transactions that harm competition,” the FTC said.
The FTC voted to allow the merger 4 to 1, the lone dissenter being Commissioner Pamela Jones Harbour.
“I am convinced the combination of Google and DoubleClick has the potential to profoundly alter the 21st century Internet-based economy—in ways we can imagine and ways we cannot,” she wrote in her dissenting opinion.
“I do not doubt that this merger has the potential to create some efficiencies, especially from the perspective of advertisers and publishers,” she continued. “But it has greater potential to harm competition, and it also threatens consumer privacy. By closing its investigation without imposing any conditions or other safeguards, the commission is asking consumers to bear too much of the risks of both types of harm.”
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