Silicon Valley Watcher - Former FT journalist Tom Foremski reporting from the intersection of technology and media

Does GougleClick violate antitrust?

Posted by Richard Koman - April 15, 2007

Google's wowser $3.1 billion bid for DoubleClick - announced Friday after the markets closed - has Microsoft pissed off. Redmond wants the government to consider the antitrust implications of the largest contextual advertising player owning the leading company in display ad online placement, The Times will report tomorrow.

Microsoft GC Brad Smith said the deal would “substantially reduce competition in the advertising market on the Web.”

AT&T joined the antitrust call, with public affairs VP Jim Cicconi saying, “For many of these new Web services, it could be that the advertising-supported model is the predominant business model,” he said. “The danger here is that Google could be in a position to pick winners and losers.”

That's rich, considering that's exactly what the net neutrality bills that AT&T (nee SBC) fought so hard against last year.

So how about the merits of the antitrust assertion? Google will most likely get its way, said law professor Andrew Gavil.

Any review of a merger on antitrust grounds begins with a determination of the “relevant market” in which the two companies operate. “That is the first hurdle in case like this,” said Andrew I. Gavil, a law professor at Howard University, “and it looks as if DoubleClick may well be in a nearby, or complementary, market instead of the same market as Google. And then the question will be how easy it is for new entrants to compete in the online advertising markets.”

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