Original URL: http://www.theregister.co.uk/2008/10/23/google_begun_deal_nixed/

Russian regulators quash Google's Microhoo play

End the Begun

By Cade Metz

Posted in Financial News, 23rd October 2008 20:45 GMT

Anti-trust regulators have rejected Google's bid to become czar of all the online Russias.

In July, Google sealed a Microhoo-esque deal with Russian search engine Rambler Media to acquire its ad unit, ZAO Begun. But as reported by Reuters, Russia's Federal Anti-monopoly Service (FAS) has blocked the $140m handshake.

According to Reuters, FAS says that Google failed to provide enough information for it to adequately assess whether the deal would hurt competition.

And we have to say: That sounds like Google.

Naturally, the company thinks FAS got it wrong. "We are very disappointed to hear that FAS has come to this decision since we strongly believe that this acquisition will enable us to significantly improve opportunities for Russian users, advertisers and publishers as well as the entire industry," a Russian Googler told Reuters.

In Russia, Google is the number two search engine behind the home-grown Yandex, and Rambler Media is the number three outfit. According to Rambler, ZAO Begun - known as Begun - boasts more than 40,000 advertisers and an online ad network encompassing 143,000 Russian language sites. And if the Rambler-Google deal were to go through, Rambler would start serving Google ads, tapping into the company's AdSense for Search and AdSense for Content programs.

The question is whether US regulators will follow the lead of their Russian counterparts. The Department of Justice is investigating a proposed search ad pact between Google and Yahoo! - the number one and number two search engines stateside - and judging from its latest quarterly earnings call, Google is also withholding information from the DoJ: namely, the company refuses to admit that it controls the prices on its black box of an ad system.

But more on that later. ®