DoubleClick Purchase not an Anti-Trust Issue if Google's Market is all Advertising Everywhere
Google CEO Eric Schmidt dismissed Microsoft's concerns that purchasing Doubleclick would stifle competition.
"We’ve studied this closely, and their claims, as stated, are not true," Schmidt told the New York Times.
Not true? How can that be? After all, Google controls more than 60 percent of the search market and as of last year was pocketing about 30 percent of online advertising dollars. DoubleClick, meanwhile, is the biggest player in graphical ads, which accounts for 34 percent of the online ad market (search accounts for 43 percent). Not to mention the global market for online ads rose 36 percent last year, according to Merrill Lynch & Co., and is worth somewhere upwards of $28 billion.
Ah, but there's the rub. Google isn't just an online advertising company. These days, after their moves into print, radio and television ads, Google is just an advertising company. Period. The online advertising market is just one part of the global advertising market, which is worth almost $70 billion.
I wonder if that will be Google's argument during the regulatory process. Change the debate by changing the terms of the debate. "Look how far we have to go in offline advertising," Google might say to anti-trust regulators. "The entire market is huge and growing and we only control, what, maybe $10 billion of $70 billion?"
I know what you're thinking: All of Google's revenues come from the online ad market. True. But buying DoubleClick will allow them to put those efforts on autopilot and concentrate on offline endeavors.