17 Gifts at All-Time Lows Gifts Under $30 'Forest Bubble' on Mars RSV and the Holidays MyHeritage 'AI Time Machine' Postage Stamp Price Increase Household Items on Amazon Melatonin vs. GABA
Want CNET to notify you of price drops and the latest stories?
No, thank you

Bizarre politics of the Google-DoubleClick deal

Federal antitrust law for mergers worries about things like anticompetitive effects, market power, and harm to consumers--not privacy.

EPIC's Marc Rotenberg at Stanford talking about Google-DoubleClick this week.
Declan McCullagh/News.com

PALO ALTO, Calif.--There is something unusual, and perhaps a little worrisome, in the arguments a band of special-interest groups has invoked against Google's purchase of the DoubleClick advertising firm.

The arguments can be found in a series of three letters (PDF) sent to the Federal Trade Commission starting in April. The letters ask, in part, that the FTC "use its authority to review mergers to halt Google's proposed acquisition of DoubleClick."

It's true, of course, that the FTC shares responsibility for reviewing mergers with the Department of Justice. What's odd is the letters say that this particular merger should be nixed not because of specific antitrust or competitiveness concerns--but because of privacy worries. (Neither the word "competitiveness" nor "antitrust" appears in the letter that kicked off the process in April.)

This seems to be an example of trying to force a square peg into a round hole. The Sherman Antitrust Act and the Clayton Antitrust Act are focused, reasonably, on conduct that may limit competition. There's nothing in either law that deals with--as the groups' second letter (PDF) to the FTC frets--Web sites that may or may not "exploit the detailed profiles of Internet users for private commercial gain, and will fail to develop the privacy safeguards that would protect consumers and lead to the development of better and more innovative business practices in a competitive marketplace."

Which brings me to Marc Rotenberg's talk at Stanford Law School's Center for Internet and Society on Monday. Rotenberg is the executive director of the Electronic Privacy Information Center in Washington, D.C., one of the groups pressuring the FTC, and his talk was called "The Case Against the Google-DoubleClick Merger."

Rotenberg, perhaps the world's foremost privacy advocate, acknowledged that "our opposition to Google actually has very little to do with competition issues...our focus was on privacy issues." The rest of the speech was a far-ranging critique of Google, from its search policies in China to a history of FTC actions against Choicepoint and Microsoft's Passport to a worry that YouTube was going to turn Google into a giant media monopoly. (Google already is "the largest media firm in the United States," Rotenberg warned, something that would probably come as news to media ownership watchdogs.)

Now, I'm not necessarily defending Google. If antitrust law prohibits the acquisition of DoubleClick, well, that seems straightforward enough. Does the deal create unreasonable market power? Will it have anticompetitive effects? No doubt the FTC has smart attorneys who can read the Sherman Act and the Clayton Act for themselves.

The worrisome part of this endeavor is that EPIC and its allies are trying to convince government regulators to, essentially, make up new laws as they go along. If federal merger law needs to be rewritten to include reviews of data collection and use practices, that's a job for our elected representatives in the U.S. Congress, not unelected bureaucrats. Congress seems highly engaged in the topic; there's no danger of it going neglected. If a review of merging firms' data use practices is useful, let's have that debate in the open instead of behind closed doors at the FTC.

I'm not alone in thinking that trying to push new data-use regulations though the backdoor may not be entirely wise (or even, perhaps, legal). FTC Commissioner Jon Leibowitz, a Democrat, said earlier this month that "our analysis of the merger has got to be about competition and potential competition. It can't be about privacy per se."

That hasn't stopped antitrust enthusiasts from trying to invent ways to merge privacy and competition law by bureaucratic fiat. Peter Swire, a law professor at Ohio State, came up with two main arguments: first, that the privacy "quality" of the combined company's products may suffer, and second, that privacy violations can harm "consumer welfare."

Swire, who occasionally does paid consulting work for Microsoft, is is no fan of the melding of Google and DoubleClick. He was quoted in the U.K.-based newspaper The Guardian as saying the combined company "will be able to charge publishers more for online content--and the effect will be to shrink content." (For his part, Swire told me on Tuesday that the conversation with the newspaper was supposed to be on background and the quotation was inaccurate, and that he has not had conversations with Microsoft about the DoubleClick deal, which it has aggressively tried to sink.)

For all I know, Swire and Rotenberg may be right in their predictions. Perhaps the privacy "quality" of Google.com post-merger will suffer, therefore harming consumer welfare. I'm just not sure this speculation justifies rewriting antitrust law sub rosa--and besides, search.msn.com, search.aol.com, search.yahoo.com, and search.ask.com will remain a simple click away.

Update November 21, 9:30 a.m. PT: Marc Rotenberg wrote to me this morning pointing me to this Mother Jones chart listing Google as one of the eight largest media companies, albeit not the largest. And Jeff Chester of the Center for Digital Democracy sent me e-mail saying his group opposes the Google-DoubleClick merger on privacy and antitrust grounds and next week they "plan to submit a separate competition document to the FTC."