14 DAY TRIAL // Microsoft has taken the face-off with Google to the next level, arguing that the Mountain View search giant is threatening the future of the Internet and that it is bad for end users. The Redmond company has hesitated little to get involved in Google's proposed acquisition of DoubleClick, as the deal came under the scrutiny of a U.S. Senate Subcommittee. Brad Smith, senior vice president, general counsel and corporate secretary at Microsoft, argued that by allowing Google to buy DoubleClick, the Mountain View search giant would inherently accede to the dominant position on the online advertising market. Smith admitted that Microsoft is by no means a disinterested player in the online advertising game, but stated that with Google's AdWords serving approximately 70% of search-based advertising worldwide, adding the services delivered by DoubleClick would not only increase dominance, but lead to monopoly.
"If Google is allowed to proceed with this merger, it will also obtain a dominant gateway position over the other main type of online advertising, the nonsearch ads that are displayed on Web sites that we visit. Today, Google and DoubleClick are the two largest competitors in this area. And as I hope we will discuss more, they are competitors in this area. And yet combined, Google will account for nearly 80 percent of all spending on nonsearch ads served to third party Web sites. In short, if Google and DoubleClick are allowed to merge, Google will become the overwhelmingly dominant pipeline for all forms of online advertising," Smith argued.
Google's chief legal officer David Drummond aimed to dodge Microsoft's arguments by positioning the Mountain View as a complementary of DoubleClick and not as a competitor. Smith countered this by presenting webpages on which both DoubleClick and Google serve advertising in tandem, saying that it was an example of competition. Microsoft has also looked to acquire DoubleClick when it was up for grabs. The Redmond company even outbid Google's $3.1 billion offer, but DoubleClick went with the Mountain View search giant. Microsoft subsequently bought aQuantive for $6 billion. Still, Smith warned that the merger of Google and DoubleClick would threaten the future of the Internet by giving one entity dominant control over the online advertising business. "It will be bad for publishers, it will be bad for advertisers and, most importantly, it will be bad for consumers", Smith prophesied.