Google: Tomorrow the World?

• Posted: Tuesday, April 17, 2007
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• Author: pradhana
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• Filed under: Google, Internet Advertising, Online Advertising

Does Google's acquisition of DoubleClick transform a concentrated industry into a monopoly?

David Hallerman - Senior Analyst

Google is set to earn $6.3 billion in net US online ad revenues in 2007. Meanwhile, total US online ad revenues will reach $19.5 billion. Many economists define a monopoly as a company that controls 25% or more of a given industry. With the announcement of its DoubleClick purchase, has the monopoly player just sealed the deal on control of the market?

Before the DoubleClick announcement, Google's position of strength had already prompted BusinessWeek to ask "Is Google Too Powerful?" in its April 9, 2007, cover story.

There is no doubt that Google has sought to grow its revenues and defend its position of strength. However, the DoubleClick purchase is not solely about buying display advertising revenue. The long-term play about acquiring deeper relationships with large publishers and advertisers.

Google has relationships with hundreds of thousands of online advertisers, from top corporations to a slew of mid-size and small companies. DoubleClick has relationships with thousands of large Web publishers. Together, Google and DoubleClick will create a robust one-stop shop for all types of online advertising purchases.

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