Google Admeld Buy Cleared by DOJ

The Justice Department blessed Google's $400 million bid to buy online display ad provider Admeld after six months of scrutiny to assure the deal did not violate antitrust laws.

Google's (NASDAQ:GOOG) $400 million bid to acquire Web display ad specialist Admeld has been approved by the Justice Department, both parties confirmed Dec. 2.

The search engine provider in June agreed to purchase Admeld, which helps large publishers sell display ads, those graphical advertisements that catch users' eyes on the fly as they land on the advertisers' Websites.

Admeld's software helps the likes of Thomson Reuters and News Corp. select ads from networks such as Advertising.com, Google's DoubleClick Ad Exchange and Yahoo's Right Media. Admeld competes with rivals such as Pubmatic and the Rubicon Project.

Some six weeks after Google announced its intent to buy Admeld, the DOJ issued a second request for information from Google about the deal.

"After a thorough review of the evidence, the division concluded that the transaction is not likely to substantially lessen competition in the sale of display advertising," the DOJ's antitrust division said in a statement. "Web publishers often rely on multiple display advertising platforms and can move business among them in response to changes in price or the quality of ad placements."

Against that sentiment, why was Google held up from consummating its Admeld deal at all?

Thanks to Google's massive market share in search and online advertising, such antitrust scrutiny has become de rigueur for large Google acquisitions.

The Federal Trade Commission in 2010 investigated Google's bid to buy mobile ad provider AdMob for $750 million, while the DOJ put Google's $700 million bid for travel software provider ITA Software through the ringer before blessing it earlier this spring.

More broadly, the FTC is currently undertaking a broad antitrust inquiry into Google's search ad practices. The European Commission, too, is investigating Google for its search business.

Google was pleased with the DOJ's decision. Neal Mohan, Google's vice president of display advertising, wrote in a corporate blog post that Google will work quickly to close the deal in the coming days.  

"People are spending more and more time consuming online content across numerous devices, advertisers are running more online and mobile campaigns to reach them, and ads continue to get more engaging and relevant," Mohan wrote. "This represents an unprecedented moment for publishers. We believe that improved technology and services can help publishers seize it and make online advertising work much better.

Mohan said Admeld's products will remain separate from Google's DoubleClick for Publishers and the DoubleClick Ad Exchange display ad services for now.

Eventually, Google and Admeld's staff will build new products and services that help its publisher partners manage and sell their ad space across not only desktops, but across mobile devices such as tablet computers.