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EU to Launch Review of Google-DoubleClick Deal

Reuters
Tuesday, 13 Nov 2007 | 12:14 PM ET

The European Commission will open a four-month, in-depth review of Google'splans to buy rival DoubleClick for $3.1 billion, a source familiar with the situation said on Tuesday.

Google, which stores data on the Internet-surfing habits of consumers, wants to buy DoubleClick to increase its clout in tailoring advertisements to consumer activities.

Both companies are involved in the sale of on-line ads, although their business models differ.

Google has already proposed alterations, and the deadline had been extended to Nov. 13 so the changes could be vetted by customers and competitors.

Google competition counsel Julia Holtz has said that in response to third-party concerns the company had committed to the Commission that it would keep certain DoubleClick business practices unchanged.

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An in-depth probe will last an additional 90 working days and does not necessarily mean there would be more changes required in the transaction.

Critics have also raised questions about what effect the deal might have on privacy, but the Commission has said privacy by itself is not part of a competition review.

Google has by far the strongest position in Web searching in Europe. The acquisition has drawn vehement opposition from competitors such as Microsoftand Yahoo.

The European Commission is working closely with the U.S. Federal Trade Commission, which has been reviewing the case since May.

In the United States, there has been one congressional hearing on the deal and Republicans are pressuring for more.

Google's purchase is part of a rapid consolidation in the Internet ad industry that includes Microsoft's $6 billion acquisition of aQuantive, home to the largest interactive ad agency.

Yahoo bought BlueLithium for $300 million and Time Warner'sAOL unit bought Tacoda.

Both of the acquired companies use cookie technology to record Web surfing habits of consumers so advertisers can target ads based on the information.

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