News Release

Consolidation of the Internet: Microsoft Bids For Yahoo!

JEFF CHESTER
Chester is the executive director of the Center for Digital Democracy and author of the recently released book Digital Destiny: New Media and the Future of Democracy. He said today: “Today’s proposed acquisition by Microsoft of Yahoo!, if consummated, will create a powerful interactive Internet duopoly in online media. Google and Microsoft will have inordinate power to shape the online communications marketplace, including journalism, entertainment and advertising. Once the most potentially democratic of all mediums, the Net is being shaped by the same powerful forces that consolidated the ‘older’ media of broadcasting and newspapers. There are consequences to democratic societies everywhere, as two digital gatekeepers are likely to control how the Internet and other interactive media evolve. In an era when individuals are increasingly conducting their personal, social and political lives online, the corporations that control the digital experience will have far-reaching influence.

“The failure of the Federal Trade Commission and the Congress to adequately address the emerging consolidation in the online advertising business helped lead to this proposed transaction. [In November 2006] the Center for Digital Democracy and the U.S. Public Interest Research Group petitioned the FTC to open up an antitrust investigation into the growing consolidation of the online ad business. We asked the FTC to impose competition safeguards in the Google/DoubleClick deal. The FTC failed to do both and has now placed consumers and competitors at risk. Beyond competition safeguards, the proposed deal underscores the need for both the FTC and the Congress to enact policies that will protect consumer data online.”
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JOSEPH TUROW
Turow is professor of communication for graduate studies at the Annenberg School for Communication of the University of Pennsylvania. He is the author of Niche Envy: Marketing Discrimination in the Digital Age and the editor of The Hyperlinked Society: Questioning Connections in the Digital Age.

He said today: “Microsoft’s decision to buy Yahoo! is a direct result of the decision by the FTC to allow Google to purchase DoubleClick. It is further evidence that despite the appearance of unlimited choice in the new media environment, people’s activities will be tracked and shaped by a very small number of companies who care far more about surveillance and targeted advertising than the public interest. The federal government, which should have been the guardian of the public interest, has dropped the ball.”

For more information, contact at the Institute for Public Accuracy:
Sam Husseini, (202) 347-0020; or David Zupan, (541) 484-9167