Doubleclick and Google to merge

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The Federal Trade Commission said that it cleared Google’s proposed merger with DoubleClick, the digital marketing company, saying that the deal was “unlikely to lessen competition” in the Internet advertising realm.

In tandem with the announcement, the agency released voluntary privacy guidelines for companies like Google that are in the business of aiming ads at people based on their actions on the Web. The gist of the guidelines was that the entire advertising industry should work together to give consumers more choice about whether they want to be tracked.

Although Google, the leading Internet search portal, and DoubleClick, which connects advertisers to advertising opportunities on the Web, have been waiting for an antitrust decision from the FTC, their uncertainty is not over yet. The merger could still be held up in Europe, where personal privacy has more legal protections than in the US and where regulators do not always follow the FTC’s lead on antitrust cases.

The European Commission said it would decide by April 2 whether the Google-DoubleClick deal should go through. Last month, the commission extended its scrutiny after an initial review raised competition concerns.

In Europe, the market share of the two companies combined is higher than in the US—close to 90% in parts of the Internet advertising business. And while the commission says it is evaluating the merger solely for its effects on pricing and market share, consumer groups are urging the commissioner to factor in privacy considerations, too. Google’s $3.1 billion deal to purchase DoubleClick has been controversial ever since it was announced, both for competitive reasons—each company is a guiding force in its business—and because of the sheer volume of personal information it would concentrate in the hands of one company. To consumer groups, the combined company’s ability to track people on the Internet and build profiles of them would be not just formidable but potentially dangerous.

Although the deal stirred up debate about the extent to which advertisers should be allowed to track people on the Web, the FTC said it was studying the merger from an antitrust perspective.