Antitrust concerns about Google’s acquisition of radio advertising firm dMarc Broadcasting did not prevent the FTC from approving the deal, but the road ahead may be a rocky one for Google on the radio dial.
By rendering a “transaction granted” decision, the Federal Trade Commission permitted Google to complete its purchase of dMarc as it announced last month. The purchase permits Google to make AdWords advertising available to clients for radio play, via the dMarc technology.
Google plunked down $102 million in cash for the company. Should the technology help Google meet further undisclosed goals, additional compensation paid by Google could lift that figure past $1.1 billion.
With dMarc, Google gets a mechanism to place its advertising into radio programming. It’s a natural fit, as radio has moved to being a digital medium on the broadcast side, and Google’s acumen in the world of ones and zeroes has been well documented.
After radio, television could be next. The Wall Street Journal elicited comments from ad executives, and one sees TV as the next logical step:
“They have to go where the money is. And the money definitely is in television,” says Rishad Tobaccowala, chief innovation officer at Publicis Groupe Media, a division of Publicis that seeks out advertising opportunities in new media.
Success for Google in radio could be a little tougher to find. Bruce Braun, commenting on PaidContent’s coverage of the deal, sees a couple of looming problems named “Clear Channel” and “Cumulus” on Google’s radio horizon:
Does Google really think these group owners are going to allow Google to muscle in on their turf? If they are thinking that way, I predict a “come to Jesus” experience for Google very soon.
DMarc, according to their site, is a barter shop that sells remnant inventory. They tout generating revenue from all the unsold inventory on a station after the logs are closed each day.
What I think Google does not understand, is that the Clear Channels of the world beat the crap out of their station sales managers to make sure that EVERY spot is sold every day, 24/7/365 at top rates.
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David Utter is a staff writer for Murdok covering technology and business.
