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Google, Microsoft spar before senators

The search firm defends its proposed acquisition of DoubleClick. Its rival raises antitrust and privacy issues.

September 28, 2007|Jim Puzzanghera, Times Staff Writer

WASHINGTON — Google Inc. tried to assure senators Thursday that its pending $3.1-billion purchase of online advertising firm DoubleClick Inc. posed no threat to privacy or competition and that consumers would benefit if regulators approved it.

But rival Microsoft Corp. countered that the future of the Internet was at stake, arguing that the deal should be stopped before Google could amass "the largest database of user information the world has ever known."


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Publicly debating the deal for the first time, Google and Microsoft executives sat side by side at a Senate hearing here and engaged in about 90 minutes of controlled sniping befitting their increasingly heated rivalry.

"There will be additional rounds before this heavyweight fight will be settled," Sen. Herb Kohl (D-Wis.), chairman of the antitrust subcommittee, said afterward.

Congress has no role in approving the deal. That authority lies with the Federal Trade Commission, which launched a detailed review in May. European Union regulators also are looking into the purchase.

But Kohl wanted to bring together executives from Google and from the deal's most public opponent, Microsoft, to determine the implications.

"This consolidation has profound consequences for all those who use the Internet and for all those who sell products and services on the Internet," Kohl said.

Microsoft also had been pursuing DoubleClick before Google snapped it up in April, triggering a flurry of deals by competitors. Among them, Yahoo Inc. bought Right Media for $680 million and Microsoft bought AQuantive Inc. for $6 billion.

Those investments show that the online advertising market is competitive and that consumers and public officials have nothing to fear from the DoubleClick deal, said David Drummond, Google's senior vice president of corporate development and chief legal officer.

"The market believes this space has a lot of room for growth," he said Thursday.

As often happens when technology executives try to explain their businesses to Congress, Drummond used an analogy to try to show that Google and DoubleClick were not competitors -- and that therefore combining them posed no antitrust problems.

Google primarily sells targeted text ads on its Web search results and on other sites, he said, and DoubleClick provides technology that places large display ads on websites and tracks who views them.

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