Judge Slaps Down FTC's Attempt To Block Whole Foods/Wild Oats Deal

from the buh-zing! dept

When the FTC stepped in to block the merger between Whole Foods and Wild Oats, it seemed like an obvious case of a market being defined too narrowly. Yes, both companies place a similar emphasis on organic foods, but organic foods represent a small slice of the overall food market, and there's no question that organic and conventional foods are substitute goods. The whole situation was roughly analogous to the situation facing XM and Sirius in their attempt to merge, as the NAB would like the FCC to define the market as simply satellite radio, while in fact it's clearly much broader. It looks like the FTC's argument has been thoroughly rejected as a federal judge declared that the merger should not be blocked. The judge's ruling remains sealed, so his exact rationale isn't known, but it sounds like this could be a useful precedent in other cases going forward.

Filed Under: antitrust, ftc
Companies: whole foods, wild oats

Now Congress Is Interested In Google/DoubleClick Deal

from the now-answer-this dept

This week, we pointed to a report that predicted the FTC would block Google's acquisition of DoubleClick on antitrust grounds. This particular case notwithstanding, the report's author made the argument that Google was likely to replace Microsoft as the chief target of antitrust enforcers. That prediction could be coming to fruition very quickly. In addition to the FTC's scrutiny of the deal, Congress has decided to drag Google in front of a committee to discuss the deal. This doesn't spell doom for the deal just yet, but it does suggest that politicians are growing wary of Google's power, in the same way they had concerns about Microsoft. It's no wonder the company has been busily beefing up its forces in Washington.

Filed Under: antitrust, politics
Companies: doubleclick, google

New Reports Turn Over Conventional Wisdom On Pending Deals

from the forget-what-ya-heard dept

Two of the big pending M&A deals right now are Google's purchase of DoubleClick and the proposed tie-up between XM and Sirius. In the case of Google and DoubleClick, it's been assumed that the deal will clear regulatory muster, despite opposition to it from Microsoft. The Sirius-XM deal, however, has been seen as a longshot, in part because of the aggressive opposition to it from terrestrial broadcasters. But two new reports are pouring cold water on the conventional wisdom. An analyst at Bear Stearns believes that the satellite radio deal is looking increasingly likely, a conclusion arrived at by monitoring hearings and reviewing FCC documents. Meanwhile, a Washington policy expert believes that the FTC is likely to block the DoubleClick deal (via Tech Trader Daily), in light of the high concentration of online advertising power that Google would obtain through the deal. Whether you agree with his conclusion or not, he does argue persuasively that this market has indeed become quite concentrated. He also ends with the seemingly inevitable conclusion that Google is set to replace Microsoft as the chief target among the antitrust set.

Filed Under: antitrust, mergers
Companies: doubleclick, google, microsoft, sirius, xm

Is Microsoft Gaining Ground In The Search Wars?

from the maybe-a-little dept

A new report makes the surprising assertion that Microsoft is actually gaining ground in the search race and that in just the last couple of months it's significantly closed the gap with Yahoo for the #2 slot. Assuming the numbers are legitimate, this would be the first sign of life out of this business in quite a while. Still, it's hard to say whether Microsoft's momentum is real. The company is probably getting a moderate boost from the adoption of Vista and the new IE7, which has Live search set as a default. If you'll recall, this setting prompted Google to make an antitrust complaint against the company. The company has also been using other lures to get users, such as awarding points to certain searchers, which can be redeemed to purchase stuff from the company. None of this suggests that users are really switching from one site to another in significant numbers (which is what would be significant), though perhaps Microsoft is picking up a few marginal users that aren't particularly attached to one service or another. If true, Microsoft will probably hit a ceiling pretty quickly.

Filed Under: antitrust, search
Companies: microsoft

Will 'Women Involved In Farm Economics' Tip The Balance In XM/Sirius Debate?

from the or-maybe-the-hispanic-chamber-of-commerce dept

Reasonable people could disagree about when it's best to disallow a given merger on antitrust grounds, but our current system seems both arbitrary and open to manipulation by interested parties. Standing athwart XM and Sirius' attempt to merge is the National Association of Broadcasters, which has tried to make the claim that the merger would eliminate any competition for the companies, a point which is undermined by the NAB's own interest in the outcome. It's obvious why the NAB is interested: It's not that it has some lofty ideals about competition, but rather it fears for the future of its own members, should the companies be allowed to merge. In addition to making its arguments directly, the NAB has also turned to the practice of astoturfing, the establishment of phony grassroots organizations that are in fact nothing more than shill groups. Blatantly self-interested lobbying isn't just limited to the NAB, however. Lobbyists representing the satellite radio firms have cobbled together an odd coalition of supporters, including Southern Baptists, businesswomen, rural voters and Hispanic chambers of commerce. A representative of one group, Women Involved in Farm Economics (WIFE), tells The Wall Street Journal that her group supports the merger because it could allow for expanded radio coverage in rural areas. She also makes the good point that the government seems to have multiple standards depending on the industry, noting that little has been done to prevent consolidation in the meatpacking market (which directly affects WIFE's constituents). Her points are valid, but it's still disturbing that these issues are decided, in large part, by which side can marshal the necessary lobbying firepower, rather than some standard for what's a legitimate level of consolidation within an industry.

Filed Under: antitrust, astroturfing
Companies: nab, sirius, xm