LONDON, April 20 (Reuters) - Google Inc.'s GOOG.O $3.1 billion planned purchase of Web advertising supplier DoubleClick raises regulatory and information issues but is a strategically brilliant deal, WPP WPP.L Chief Executive Martin Sorrell said.
“I think the DoubleClick acquisition clearly raises some regulatory issues which a number of media owners, publishers and competitors like Microsoft are very exercised about,” Sorrell, the head of the world’s second-largest advertising company, told Reuters on Friday.
Speaking after the release of WPP’s first quarter results, Sorrell said some estimates suggested the deal would give Google an 83 percent share of the contextual and targeted online advertising market.
“It raises some issues for us,” he said. “It raises issues as to whether we are happy to let Google have our client’s data and our own data which Google could use for its own purposes in contextual and targeted advertising.”
Microsoft, the world’s largest software maker, has said the deal raises serious competition and privacy concerns and would allow Google to corner the online ad market and receive a huge amount of information on consumer behaviour.
Sorrell also noted that Google had said it expected the deal to close by year-end, “and I believe that indicates they do think they are going to have to clear some regulatory hurdles.”
Founded in 1996, DoubleClick offers a digital marketplace that connects ad agencies, marketers and Web site publishers. It has more than 1,500 corporate clients. Yahoo Chief Executive Terry Semel told Reuters earlier this week that DoubleClick could see defections by advertisers put off by the Google purchase and said he had heard concerns from various advertisers, ad agencies and others.
“It’s going to be very interesting to see how it shakes out,” Sorrell said, adding that WPP worked closely with Google.
“We buy about $200 million of their media and that’s up from about 150 million last year,” he said.
“Google is a short-term friend and a long-term enemy and probably the shorter term just got a little bit shorter and the longer term got a bit closer as a result of the DoubleClick acquisition.”
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