Never Mind Publicis Omnicom. Are Google and Facebook Too Damn Big?

We've Basically Stopped Thinking About How Big Is Too Big When It Comes to Certain Types of Companies

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How big is just too damn big? That question is being endlessly debated right now in the wake of the announced merger of Omnicom and Publicis, which will create the world's largest ad firm.

Credit: Kelsey Dake

As my colleagues Rupal Parekh and Bradley Johnson reported, citing information compiled by the Ad Age DataCenter, Omnicom and Publicis in 2012 together accounted for 41.2% of revenue among the world's 10 largest media agencies. The co-CEOs of the combined entity, Publicis' Maurice Levy and Omnicom's John Wren, seem pretty convinced they won't face substantive governmental objections to the deal, but others aren't so sure.

Just four days after the deal was announced, Ad Age London Editor Emma Hall reported that the World Federation of Advertisers and the Incorporated Society of British Advertisers were already canvassing their members in anticipation of huddling with antitrust regulators.

Ah, the A-word -- antitrust. It's interesting to see that once-intimidating term in this context. I mean, consider some of the other related species that already roam the Earth, the giants that are already bigfooting their way through adland. If Publicis Omnicom is possibly too big in a bad-for-competition sort of way, well, what about Google and Facebook?

Google'>Google</a>'>Google</a>'>Google</a>">Google has 67% of the U.S. search market -- and even higher percentages in some foreign markets -- according to ComScore. In June, eMarketer projected that this year Google will own 33% of global online ad revenue -- and 56% of global mobile ad revenue.

Meanwhile, Facebook, of course, completely dominates in social, with 1.15 billion monthly active users as of June. It's gone from 0% to 13% market share of global mobile advertising in just the last two years. And Facebook's projected 2013 net digital ad revenue of $5.89 billion (20% growth vs. 2012), will, per eMarketer, outpace that of Yahoo, Microsoft, AOL, IAC, etc.

And keep in mind that both Facebook and Google seem increasingly inclined to use their market muscle in arguably monopolistic ways. Facebook, for instance, has been able to endlessly jerk around its users in regard to ever-shifting privacy policies and practices because it knows that even the most disgruntled among its userbase have no real marketplace alternatives (Google+? MySpace? Ha!).

And Google appears to be devoting more of its screen real estate -- particularly on mobile -- to pushing its own media products. See "How Google Is Killing Organic Search," a widely circulated July blog post by Aaron Harris, co-founder of Tutorspree, in which he argues that "if you compete with Google in any way, you're in its crosshairs. Your chances of ranking high enough to garner traffic are virtually nil and getting smaller."

Both Facebook and Google are intent on breakneck growth both organically and through aggressive acquisitions (e.g., Facebook's purchase of Instagram for $1 billion, Google's purchase of Waze for $1.1 billion). With Google stock trading near its 52-week high, and Facebook finally pushing past its IPO price just last week, both companies have ample war chests for further big buys.

Will anyone stand in their way? Well, in Europe ... possibly. As Reuters reported last week, EU regulators have been busy surveying Google's rivals with a particularly pointed questionnaire. One query cited by Reuters: "In the period from January 2011 to June 2013, have you ever noticed a decrease in the number of users reaching your vertical search sites via Google's natural search, which cannot be explained by a change in your website?"

And as I've written in this space before, Google and Facebook -- and U.S.-based tech companies in general -- will likely face dramatically ramped-up scrutiny from EU privacy regulators in the wake of European outrage over the American tech establishment's seeming (witting or unwitting) complicity with the NSA's digital spying programs.

But here in the U.S., "antitrust" has a certain quixotic ring to it for a very good reason: The federal government's epic, drawn-out -- and ultimately pointless -- antitrust pursuit of Microsoft is still somewhat fresh in memory. Microsoft obviously had a monopoly on desktop computing, but then the desktop era started to draw to a close on its own.

Essentially, we've stopped thinking about how much power is too much power when it comes to tech companies because we've become accustomed to the idea that all power in the tech realm is fleeting.

In other words, Americans know better than anyone that in the technology world, fearsome, all-powerful giants have a way of becoming, rather suddenly, dinosaurs. (Just look at how many comets have struck Silicon Valley.)

As tech companies become ad companies and ad companies become tech companies -- as all media and advertising goes digital -- we seem to have reached an uneasy consensus: The best way to address too-big players is to just let nature take its course.

Afraid of Google and Facebook ... and Publicis Omnicom, for that matter? Just be patient. Just be a little bit patient.

Simon Dumenco is the "Media Guy" columnist for Advertising Age. You can follow him on Twitter @simondumenco.

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