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Google Defends DoubleClick Deal

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Google Defends DoubleClick Deal

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Google Defends DoubleClick Deal

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RENEE MONTAGNE, host:

NPR's business news starts with a new clash between Microsoft and Google.

Google went to Congress yesterday to defend its proposal to buy the online ad firm DoubleClick. It's offering more than $3 billion. But Microsoft is leading the criticism of the merger, saying it would give Google too much power over the Internet ad business.

NPR's Jim Zarroli reports.

JIM ZARROLI: Google's proposed acquisition of DoubleClick is being reviewed by the Federal Trade Commission, but the hearing yesterday before a Senate subcommittee was a chance for lawmakers to weigh in on the deal too. Much of it focused on the deal's effects on competition.

Microsoft's general counsel, Brad Smith, said Google is already the biggest power in search advertising. Smith said acquiring DoubleClick would allow it to dominate banner advertising as well.

Mr. BRAD SMITH (General Counsel, Microsoft): In short, if Google and DoubleClick are allowed to merge, Google will become the overwhelmingly dominant pipeline for all forms of online advertising.

ZARROLI: Smith said online advertising is already a $27 billion business and has become the economic fuel for the growth of the Internet. But Google's chief legal officer, David Drummond, rejected the claim that the deal was anti-competitive. Drummond said Google and DoubleClick don't compete head-to-head. He said Google sells ads while DoubleClick is a broker between advertisers and Web sites.

Mr. DAVID DRUMMOND (Chief Legal Officer, Google): We've never sat around the boardroom and talked about our competition with DoubleClick. It is a very different business.

ZARROLI: In what may bode well for Google, none of the senators indicated they oppose the deal, but several did say that they were worried that the deal raises privacy concerns.

It would allow Google to collect and store information when Internet users click on ads, even more information than the company has access to now. But Democratic Senator Charles Schumer of New York said he'd been assured by Google that it would take steps to protect consumer's privacy.

Jim Zarroli, NPR News, New York.

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