BEUC opposes Google-DoubleClick deal
Phil kindly pointed out that several European organizations have filed a letter to the European Commission urging them to block the Google-DoubleClick merger. (1) Unlike the FTC, which says that is only considers the effects on competition when deciding on the legality of mergers, the EC takes into account both competition and privacy concerns. In addition to bringing up concerns about competition, the letter stated that “privacy issues may be highly relevant to such analysis in some circumstances, including where a merger combines two of the world’s largest data bases of consumer preferences.” (2)
According to the letter, the merger would greatly increase Google’s and DoubleClick’s ability to track users by combining Google’s search data with DoubleClick’s extensive record of users’ web-surfing habits. Another interesting point the letter brought up was that if the deal created a monopoly, Google-DoubleClick would be less motivated to respect privacy. Especially in
Europe, companies try to develop new ways to give users choices about their privacy as a way to be more appealing than their competitors. However, “post-merger, there is a danger that Google will lose any incentive to continue innovating in this area due to its hugely dominant position in online advertising. It will be under considerably less competitive pressure to improve – or even maintain – the poor quality of its current privacy practices.” (2)
Finally, the authors of the letter raised the point that the merger may facilitate price discrimination. If Google-DoubleClick is able to track users’ shopping habits, then it would be able to advertise different prices for the same product – perhaps charging low prices to lure frugal shoppers and taking advantage of impulsive buyers by charging them more. (2)
Sources:
1. “European lobby rejects Google-DoubleClick merger.” CNET News.com. 20 Dec. 2007 <http://www.news.com/European-lobby-rejects-Google-Doubleclick-merger/2100-1030_3-6223610.html?tag=sas.email>.
2. “Further observations on the proposed acquisition of DoubleClick to Google.” BEUC.org. 18 Dec. 2007. 20 Dec. 2007 <http://docshare.beuc.org/docs/2/OHAFOCHBJKFHDGEDCFFJFCJFPDB39DWYTK9DW3571KM/BEUC/docs/DLS/2007-01174-01-E.pdf>.
