The New York Times Friday published several documents Microsoft used to make the case that a Google purchase of DoubleClick would give the search engine powerhouse several competitive advantages in the online advertising market.
Microsoft was hoping the documents, which include a three-page diagram (PDF) of the so-called online ad “pipeline” Google would control should the $3.1 billion deal be consummated, would sway the Federal Trade Commission into believing that the purchase would make Google the consummate monopolist.
Now that the FTC has blessed the merger (Merry Christmas, Google), Microsoft’s documentation of Google’s online ad position comes off as the data-driven equivalent of flipping the chess board up in frustration; Microsoft sees Google’s checkmate coming, but the only thing it can do is make some noise and hope someone listens.
Will the European Commission listen? I doubt it. Turnabout is fair play. How many Microsoft competitors felt the same helplessness watching the presiding market gorilla eat all of its bananas?
Microsoft also articulated (Word doc) how the combination of Google’s vast ad networks with DoubleClick’s publishing tools will give the company overwhelming chunks of the market.
In fact, I owe Microsoft thanks because I learned more about what Google’s position in the market will look like once it tucks in DoubleClick from Microsoft than from what Google offered.
But the best part of these documents is not the detail, it’s the prognostications that could shed light on just how ingenious (and perhaps, insidious) Google’s ad plans are with DoubleClick.
Drawing on Google’s history of providing software or services for free in exchange for the right to have and use data, Microsoft suggested that Google will offer DoubleClick’s DFP (DART for Publishers) hosted ad-serving platform for free in exchange for the first shot at publishers’ remaining inventory.
The idea is that, like any tyrant, Google could sift through the good stuff and save the spoils for Microsoft, Yahoo and anyone else vying for pie.
Microsoft covered all the bases. Not only did it provide a document explaining how Google could lock others out of the market, but it composed a list (Word doc) of six suggestions for lessening the impact of a Google and DoubleClick marriage.
These include spinning off DFP businesses to an independent and viable purchaser; open access for competing ad networks; open access to AdSense/AdWords for competing tool vendors; elimination of restrictive API practices; prohibiting exclusive dealings; and setting up firewalls so that the Google commercial organization cannot access competitively sensitive data flowing through DoubleClick’s ad-serving tools.
My guess is that any of these “remedies” would be a deal-breaker for Google.
Anyone who wants to really dive into the ramifications of the deal to see how it will affect the online ad market should check out these documents. Are they FUD? They most certainly are. But it’s also some of the best organized and compellingly articulated FUD I’ve ever read.
I would love to know exactly what the FTC thought about these documents and how well it weighed them prior to making its decision. If you believe the allegations in the Microsoft documents, the DoubleClick deal could cripple competitors.
My guess is the FTC considered how the DoubleClick deal would hurt the consumer and not how it will hurt Microsoft, Yahoo, et al. Perhaps Microsoft should have spent more time explaining how a Google-DoubleClick union could harm consumers instead of toppling the online ad chessboard.
Perhaps Microsoft didn’t go there because it didn’t have the evidence to support a case for the deal harming consumers, in which case the point is moot.