EU Clears Google-Doubleclick

Cite this Article
Joshua D. Wright, EU Clears Google-Doubleclick, Truth on the Market (March 11, 2008),

From the WSJ Online:

The transaction had faced stiff opposition in Brussels from Google rivals including Microsoft Corp. and Yahoo Inc., as well as privacy advocates who fretted that a combined company would control a vast storehouse of data on Web users and their surfing habits. But European Commission antitrust officials early on ruled out examining the privacy implications of the deal, resulting in a conventional merger analysis that left fewer ways for the deal to be blocked. In the end, the EU concluded that the still-nascent online-advertising market is changing quickly enough and has enough competitors that a combined Google-DoubleClick wouldn’t be able to shut out rivals. The purchase “would be unlikely to have harmful effects on consumers,” the EU said in a statement. The EU’s approval had been expected. The U.S. Federal Trade Commission gave its blessing, in a 4-1 vote, in December.

UPDATE: Here is more from Google’s Eric Schmidt and a few excerpts from the EC’s Press Release:

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. 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 Commission therefore concluded that the elimination of DoubleClick as a potential competitor would not have an adverse impact on competition in the online intermediation advertising services market.

And with respect to non-horizontal issues the Commission:

found that the merged entity would not have the ability to engage in strategies aimed at marginalising Google’s competitors, mainly because of the presence of credible ad serving alternatives to which customers (publishers/advertisers/ad networks) can switch, in particular vertically integrated companies such as Microsoft, Yahoo! and AOL. The market investigation also found that the merged entity would not have the incentive to close off access for competitors in the ad serving market, mainly because such strategies would be unlikely to be profitable.