Consumer groups try to block Google purchase of AdMob
Two consumer groups urged the US Federal Trade Commission (FTC) on Monday to block Internet search and advertising giant Google's proposed purchase of mobile advertising company AdMob.
In a joint letter, Consumer Watchdog and the Center for Digital Democracy (CDD) asked the FTC to oppose Google's acquisition of AdMob on anti-trust grounds and said the deal also raises privacy concerns.
The move comes after Google said last week that the FTC was seeking more information about its proposed 750-million-dollar acquisition of AdMob.
"The proposed deal would substantially lessen competition in the increasingly important mobile advertising market," Consumer Watchdog and the CDD said in their letter to FTC chairman Jon Leibowitz.
"Instead of acquiring dominance in this increasingly important market through legitimate competition and innovation, Google is buying its way to a preeminent position," the non-profit groups said.
They urged the FTC to use its"statutory and regulatory authority to oppose the merger."
"In addition to the antitrust issues, the specter of a combined Google/AdMob raises substantial privacy concerns that must be addressed by the commission," the groups said.
"Permitting the expansion of mobile advertising through the combination of these two market leaders without requiring privacy guarantees poses a serious threat to consumers," they said.
"The mobile sector is the next frontier of the digital revolution," Consumer Watchdog and the CDD said. "Without vigorous competition and strong privacy guarantees this vital and growing segment of the online economy will be stifled."
Paul Feng, a group product manager at Google, said in a blog post last week that Google had received a "second request" for information from the FTC about the acquisition of AdMob.
"While this means we won't be closing right away, we're confident that the FTC will conclude that the rapidly growing mobile advertising space will remain highly competitive after this deal closes," Feng said.
"We'll be working closely and cooperatively with (the FTC) as they continue their review," he added.
Google, which previously has drawn scrutiny from US antitrust regulators, hopes AdMob will help it more effectively extend its lucrative Internet advertising domain into the booming world of mobile devices.
Earlier this year, Google was forced to revise its legal settlement with authors and publishers over its digital book-scanning project amid objections from the US Justice Department.
Last year, Google was forced to abandon a proposed advertising agreement with Yahoo! amid Justice Department anti-trust concerns.
(c) 2009 AFP