Google Acquires Admeld, DOJ May Say “No Way”
On Friday, June 10, 2011 news began to break that Google was to acquire Admeld, an ad optimization company, for $400 million. While not the largest in the space – which includes companies like Pubmatic and Rubicon – Admeld is considered to be one of the best in the business at helping publishers make the most of and optimize remnant inventory to increase revenue.
You may be thinking, “Is this news? Hasn’t Google spent billions of dollars on purchasing companies in the past?” The answer is, yes. However, according to stories by the Wall Street Journal and Bloomberg, the Department of Justice and the Federal Trade Commission are becoming very interested in these acquisitions. The FTC is opening a broad, though “informal,” antitrust investigation, while the DOJ is conducting an antitrust review, according to sources close to the matter.
While neither Google nor the DOJ opted to comment on the antitrust matter, according to one Google executive, the Admeld acquisition “will be an important step to help online publishers, and will further improve and grow the display advertising industry as a whole.” The goal for Google would be to combine Admeld’s expertise with the DoubleClick Ad Exchange in order to aid publishers in selling ad space on their websites. Google purchased DoubleClick in 2007 for $3.2 billion.
For a company that is accustomed to scrutiny from various government agencies, this should not faze Google. The DoubleClick purchase and last year’s $750 million acquisition of AdMob both caught the FTC’s attention and nothing came of it. But there are a few within the industry who believe that Google is in greater peril with the government than it appears, and that antitrust concerns are greater than anyone thinks, especially with news of the Admeld purchase.
The interesting story growing here is how this will affect Google’s influence on the display advertising marketing, which could grow into a $200 billion industry. In addition the FTC/DOJ investigations, certain industry insiders feel that all of Admeld’s premium publishers will abandon the platform as they have no interest in Google’s reach extending to the management of their ad inventory.
Stay tuned… this one is bound to get more interesting!