Microsoft Leads the Grumbling
As expected, Microsoft wasted little time voicing its opinion of Google’s latest monster $3.1 billion acquisition of advertising network DoubleClick. However, they are not alone.
Brad Smith, General Counsel for Microsoft, said, "This merger deserves close scrutiny from regulatory authorities to ensure a competitive online advertising environment."
AT&T also chimed in and agreed with Microsoft. Senior executive vice president of external and legislative affairs at AT&T, Jim Cicconi, said, "It’s critical that this merger be stringently reviewed by regulators. Google is acquiring its only substantial competitor, thereby positioning itself as the sole broker of internet advertising. This merger … will allow Google to pick winners and losers in the internet ad space."
Cicconi added that "If any one company gets a hammerlock on the online advertising space, as Google seems to be trying to do, that is worrisome."
AT&T’s involvement here may be stemming from a fear of being "relegated to utility status," as David A. Utter at WebProNews said.
AOL and Yahoo! have reportedly taken their stances alongside Microsoft and AT&T as well.
For advertisers, the concerns arising from this deal might be a bit different than those raised by the large companies mentioned above. A team of Google and DoubleClick could very well handle a large majority of all advertising online, which would mean that the combination would have a very large amount of data on its hands.
Concerns over Google’s current wealth of information and data have already been raised, and reached a peak when evidence for "GDrive" surfaced.
AOL relies on Google for its search advertising, while it relies on DoubleClick for its display advertising, and Nate Elliot, an analyst at JupiterResearch, estimates that about 75% "of their advertising revenue would run through DoubleClick-Google."
Google has denied that any of the concerns raised are legitimate. CEO Eric Schmidt said, "We’ve studied this closely, and their claims, as stated, are not true."
He added that Google welcomed the debates and discussions that would take place in regulatory procedures in the U.S. and Europe.
The irony of Microsoft’s anticompetitive claims is hard to ignore, but it seems that there is at least a hint of legitimacy to their fears. However, one has to wonder how much of their opposition to this deal really stems from angst because of yet another loss to Google.
Early in 2006, Google filed complaints to regulators about Microsoft’s Internet Explorer Internet browser. The argument was that Microsoft made it difficult to select other search engines other than MSN as the default selection. The U.S. Justice Department eventually ruled in favor of Microsoft.
It seems payback time has arrived.
Sources:
http://www.nytimes.com/2007/04/16/technology/16soft.
html?ex=1334376000&en=e67b8532cbba5ba8&ei=5088&partner
=rssnyt&emc=rss
http://news.independent.co.uk/business/news/
article2455098.ece
http://www.webpronews.com/insiderreports/2007/04/16/
microsoft-cries-antitrust-on-googles-doubleclick-buy
http://news.yahoo.com/s/pcworld/20070416/tc_pcworld/
130770;_ylt=AhVFehn88qg0ysChi3lXpfT6VbIF
