A longtime inspector of online ad related deals, U.S. Sen. Herb Kohl called for the Federal Trade Commission to give Google's proposed acquisition of AdMob a closer look. As reports surface that the FTC will do just that, the Wisconsin Democrat argues that antitrust issues related to the merger should be scrutinized.
In a letter sent to FTC Chairman Jonathan Leibowitz yesterday, Kohl wrote that allowing a single firm to dominate the mobile ad market "could result in higher prices for mobile advertising on the Internet and with respect to smart phone applications, and also could result in lower revenues realized by applications developers. Without reaching any conclusion as to whether the Google/AdMob transaction would create such dominance or would cause any substantial harm to competition, I believe it is essential that the FTC scrutinize this deal very closely to carefully examine this question."
Kohl also warned of privacy implications of the deal, noting, "the combined firm will gain access to a treasure trove of data on millions of consumers' behavior, search and product preferences. The FTC should assure itself that the deal, if approved, will have sufficient safeguards to protect consumers' privacy."
Kohl, who heads the Senate's antitrust panel, was among those to express competition-related concerns about the now-defunct 2008 search deal between Google and Yahoo, as well as Microsoft's now active search ad partnership with Yahoo, and Microsoft's failed bid to buy Yahoo outright in 2008. He also warned against "the creation of a powerful Internet conglomerate able to extend its market power in one market into adjacent markets" in a 2007 letter asking the FTC to give Google's DoubleClick acquisition a closer look.
In letter sent to the FTC last month, a handful of Congress Members also asked the FTC to "scrutinize how the [Google/AdMob] deal will affect competition and Google's incentives to offer robust consumer privacy protections." The group was also critical of potential privacy infringements of Google Buzz, the firm's recently-launched social application.
Yesterday the FTC announced that the recently-confirmed commissioner Julie Brill, who has spent much of her career dealing with consumer privacy issues, had begun her work with the agency. Some believe her addition will lead to even more interest from the FTC in the issue of online privacy.
The letters come amid reports from publications including The Wall Street Journal that the FTC has put together an internal legal team in order to block the partnership. Apple recently purchased AdMob competitor Quattro Wireless, a deal Google has pointed to in order to prove the mobile ad sector has remained competitive since it agreed to buy AdMob.
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Kate Kaye was Managing Editor at ClickZ News until October 2012. As a daily reporter and editor for the original news source, she covered beats including digital political campaigns and government regulation of the online ad industry. Kate is the author of Campaign '08: A Turning Point for Digital Media, the only book focused on the paid digital media efforts of the 2008 presidential campaigns. Kate created ClickZ's Politics & Advocacy section, and is the primary contributor to the one-of-a-kind section. She began reporting on the interactive ad industry in 1999 and has spoken at several events and in interviews for television, radio, print, and digital media outlets. You can follow Kate on Twitter at @LowbrowKate.
March 19, 2014