Spending money like
a sailor on shore leave, Google has agreed to pay $3.1 billion
cash for DoubleClick, the $150 million-a-year display ad-targeting
cookie-carrying activity-tracking Silicon Alley firm that was
also being pursued by Microsoft.
It’s the most money Google has been prepared to pay for
an acquisition so far, twice what it paid six months ago for YouTube
– which only merited stock – and is obviously both
strategic and defensive.
Microsoft’s interest may have cost Google in the neighborhood
of a billion dollars – or will if the deal goes through.
DoubleClick’s rejected suitor as well as AT&T, Time
Warner, Yahoo and Viacom are raising antitrust objections to the
acquisition with Washington.
Microsoft general counsel Brad Smith, in a statement issued Sunday,
said the deal “raises serious competition and privacy concerns
in that it gives the Google DoubleClick combination unprecedented
control in the delivery of online advertising, and access to a
huge amount of consumer information by tracking what customers
do online. We think this merger deserves close scrutiny from regulatory
authorities to ensure a competitive online advertising market.”
With DoubleClick in its possession, Google would control more
than 80% of the ads served on the Internet according to what Smith
told the Wall Street Journal, which broke the story. Microsoft,
of course, is losing its shirt to Google in advertising and search.
The acquisition, because of its size, requires regulatory approval.
Apparently anticipating complaints, Google claimed when it announced
the deal Friday that it did “not believe this acquisition
is anti-competitive as it promotes a vibrant healthy market for
online advertising.”
Private equity firms Hellman & Friedman and JMI Equity took
DoubleClick private for $1.1 billion two years ago when it was
losing money. Pieces of the company have subsequently been sold
off and they paid only $335 million for what Google is buying.
Published Apr. 17, 2007
Copyright © 2007 SYS-CON Media. All Rights Reserved.
|
