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Google/DoubleClick v. FTC, Round 15,627,734,234.7



As if the title weren’t enough to tip you off, take a peek at some of the headlines that have gotten my attention today (don’t worry, this isn’t Linky Goodness or Pilgrim’s Picks, I’m still going to hold your hand and tell you what to think):

As I said, this isn’t a links post, so I’ll summarize all that for you (I’m just making sure I get all my attribution links in there!), and add my two cents, FWIW. (Okay, I think I’m really clever today.)

Battle lines bein’ drawn. Nobody’s right if everybody’s wrong
First off, Representative Joe Barton (R-TX) tried to arrange for House staffers to visit the Googleplex. Their schedules never worked out, and since then Barton says he’s been “rebuffed” by Google in their further attempts to find a convenient time (it’s not like they’re busy in the ‘plex or anything. Or DC.).

So Barton has written a letter consisting of twenty-four multi-part questions for Google to answer—most of them about privacy.

A lot of these questions, as reprinted on CNET, are pretty hard hitting, though a few make me think he certainly could have figured it out himself (“Please explain whether Google posts a link to its privacy policy on the home page or search results page of www.google.com” and “Please explain the technology called “rich media” or “interactive multimedia,” how this technology works, and what information may be collected by its use.”).

Barton or someone in his office clearly does have an understanding of many Internet and online advertising technologies, since his questions include questions about anonymizing IP data and cookie data, resetting cookies and specifics about user information collection, storage, retention and access. Barton also quotes Google’s policies and asks for specific clarification and definitions of terms that Google uses. Finally, he asks if and how user data from DoubleClick, if approved, will be segregated from Google’s other user data.

It would be nice to have a detailed response from Google—and every other search engine, including Ask—to each of these concerns. However, based on CEO Eric Schmidt’s response, I don’t think a public answer is forthcoming.

Step outta line, the man come and take you away
Barton, of course, isn’t the only one worried about privacy issues with Google. The review of their pending merger with DoubleClick has taken eight months—while similar deals between Yahoo & Right Media and Microsoft & aQuantive were quickly okayed. The final deadline for the decision was supposed to be today—and I’m gonna guess that they’re not ready yet. Rumor has it that they have extended that deadline.

Something’s happening here, what it is ain’t exactly clear
And then, to make matters murkier (and slower), everyone’s favorite FTC lobbyists, the Electronic Privacy Information Center and the Center for Digital Democracy (EPIC and CDD, respectively), have asked FTC Chair Deborah Platt Majoras to recuse herself from the committee for this decision, citing a potential conflict of interest.

The conflict itself, however, is a point of controversy. Majoras’s husband is a partner at the law firm of Jones Day. Jones Day’s clients include DoubleClick. While it seems pretty clear cut at first—Majoras has recused herself from other decisions involving her husband’s clients—it gets a bit more confused as DoubleClick and Jones Day insist that the law firm’s representation only refers to the European approval process, not the FTC case.

However, the Jones Day website used to state that:

Jones Day is advising DoubleClick Inc., the digital marketing technology provider, on the international and U.S. antitrust and competition law aspects of its planned $3.1 billion acquisition by Google Inc.

(This wording was removed; however, Google retains its cached copy. A touch of irony for you there.)

Both Jones Day and DoubleClick maintain that the law firm is used only outside of the US. DoubleClick has even clarified to CNET that their domestic law firm is Simpson Thatcher.

Paranoia strikes deep; into your life it will creep
Best of all, as paidContent reminds us, the FTC has long said that it’s not concerned with the privacy implications of the merger, just the antitrust issues. Interestingly, as CNET reminds us, the FTC hasn’t challenged a vertical merger in about thirty years.

Antitrust laws are basically designed to prevent monopolies. So a horizontal merger, like Google buying Yahoo (what that reference start the rumor mill!), receives a lot more scrutiny than a vertical merger, like Google buying DoubleClick, or any other company that’s not a competitor in its sector.

The bottom line: (Young people speaking their minds)
I still don’t see what the FTC is waffling over. Yes, I see that the DoubleClick/Google merger is a potential privacy nightmare. But the FTC, while charged with protecting consumers, has decided to ignore those issues and look only at the competition problems. If that’s truly the case, then Google deserves the same approval that Microsoft and Yahoo have received. After all, we want them to be able to compete among themselves, don’t we?

The reality is, of course, that the only real reason the FTC hasn’t already approved the merger has got to be that they are worried about consumers’ privacy. Perhaps Google (who has complied with the FTC’s requests thus far) should consider publicly answering Rep. Barton’s questions to set the minds of Congress, the FTC and the rest of us at ease.

  • Eduardo

    Privacy online doesn’t exist. People need to learn that fact.

  • http://www.thevanblog.com Steven Bradley

    “For what it’s worth,” one of my favorite songs.

    What’s interested me about this deal is that the other major engines have all had their similar deals go through without a hitch. Obviously the amount of data a combined Google/DoubleClick will have surpasses what the other search engines will have, but still.

    I guess Google’s lobbying efforts have a way to go.

  • Jordan McCollum

    @Steven—Glad someone got it ;). Either Google’s lobbying efforts need help or Microsoft’s lobbying efforts are just too powerful to counteract; Microsoft and Google have each lobbied against the other’s deal.