Google's $400 million acquisition of display ad ROI optimization tool AdMeld has, unsurprisingly, prompted action from the DOJ. According to multiple sources, an antitrust review has now commenced.
The Acquisition and Its Anti-Competitive Risks
We previously discussed the AdMeld acquisition, but the brief story is this: Google spent $400 million (U.S.) to buy AdMeld, adding AdMeld's ROI-focused toolset to the already impressive Google display ad arsenal. Adding new resources for content publishers seems to be the objective.
The problem is the "closed loop" this system creates. Since Google sells to advertisers and provides ads to publishers, having an ROI-optimization tool that allegedly evaluates multiple ad networks could be problematic; Google has the opportunity to, hypothetically, favor their own advertisements even when it isn't in the benefit of the content publisher.
According to a Google spokesperson, "This acquisition is designed to help publishers get the most from the rapidly growing display advertising industry, which is both complicated and incredibly competitive." But others, such as Frank Addante, CEO of The Rubicon Project, disagree.
"This acquisition and this type of business model is good for Google," said Addante, "but bad for publishers."
Antitrust Review: Hello, Google! It's the DOJ Again
Google has received plenty of attention from the Department of Justice over the last few years, with multiple cases in the U.S. and even more in Europe. While you won't find the AdMeld-Google deal in the current DOJ listing, Google still seems to be a star of the list's show.
It's gotten to the point that Google's acquisitions may as well add "antitrust" to their project deployment schedule. Of course, given the average turnaround on DOJ antitrust hearings, it would also be the longest phase of deployments.
With Google's immense size and practical monopoly status in the search industry (as well as majority market share in multiple other arenas), the frequency of these hearings are hardly surprising. However, it's still a painful reality for the company.
As noted on paidContent, the antitrust case "will certainly allow plenty of time for Rubicon and others in the space time [sic] to try to pick off Admeld’s publisher customers and gain greater market share."