EC eyeing Google, DoubleClick tie-up


BRUSSELS -- The European Commission is set to investigate Google's $3.1 billion plan to buy online advertising giant DoubleClick amid concerns from consumer groups that the deal will damage privacy rights.

The commission -- the European Union's antitrust authority -- stepped in even though it falls beneath the EU's €5 billion ($6.8 billion) threshold for reviewing mergers. Google itself asked the EC to conduct the investigation after realizing that it would be simpler than asking each of the EU's 27 national authorities for clearance.

"Given the pan-European nature of both Google and DoubleClick's businesses, we felt that the Commission was best placed to review the acquisition," said Julia Holtz, Google's competition counsel for Europe.

DoubleClick is the world's largest broker of online banner advertising. Its products allow customers to place and track online advertising, including search ads. Although the online advertising market is new and subject to rapid change, Google says it is confident of allaying any antitrust concerns.

"Both companies have a proven track record of innovation and together we believe that we will be able to bring better, lower-priced services to advertisers and publishers -- as well as more relevant adverts for users," Holtz added.

However, the planned takeover has raised concerns from European consumer group BEUC, which says it will damage privacy rights and limit consumers' choice of web content. In a letter to EU Competition Commissioner Neelie Kroes last month, BEUC said the takeover will give Google a monopoly in the $28.8 billion global online advertising market.

The market share of the combined company would leave consumers with "no real ability to choose services other than those served by Google," the group said in the letter.

BEUC also pointed out that both companies collect and store information about consumers' Internet habits, and the combination could endanger privacy.

"Never before has one single company had the market and technological power to collect and exploit so much information about what a user does on the Internet," it said. As the world's largest Internet search engine, Google relies on its cookies and user logs to compile information of the search terms entered into specific Web browsers as well as other potentially sensitive online information.

Google's privacy policies already are being probed by an EU panel of national data protection officers to see if it stores search information for too long. The company has offered to cut the time it retains data on user searches from the current 24 months to 18 months, in a bid to assuage EU concerns.

Google announced plans to buy DoubleClick in April to bolster its sales of Internet ads that include pictures and videos. In the U.S., consumer privacy advocacy groups already have asked the U.S. Federal Trade Commission to investigate the proposed deal.