Google Inc., the shining star of the search engine world is trying to enter the Russian market by offering them a surprising price of $140 million as the purchase price for Begun Advertising Agency. But the sad part of this episode is that the Russia’s anti trust watchdog has rejected Google’s offer. Google had its own reason for making this proposal as it had thought that the collaboration would make a lot of difference as this would reduce the competition that exists among Google and other online advertising market.
Russia’s FAS (Federal Anti-monopoly Service) had disapproved the offer as it considers that the information that are provided by Google are not sufficient for FAS to conclude that it would reduce competition. They have specified that the documentations on the company working in Russia were incomplete. Based on these factors, this was decided by FAS on Oct 22nd 2008 and the details were made available at FAS’s official website www.fas.gov.ru.
FAS came into existence just a few months ago and this anti-monopoly service became famous only after the Prime Minster of Russia Vladimir Putin in a speech mentioned that he expects anti-trust service to be more active and outstanding.
Google is terribly upset about what had happen and on behalf of Google its Russian PR director Alla Zabrovskya had said they are very disappointed to know about FAS’ decision. He said that Google would have improved the existing systems dramatically if only they had had got a chance to have synergies between Google and the Federal Anti-monopoly Service. He added that it would also help other Russian users and people who use the internet like advertisers and publishers in all the field. He had also mentioned in his interview that discussions of what should be done next and what other further steps should be taken would be decided after hearing FAS’s final decision and all this would take place after the review.
Begun is as famous as Google in Russia as it this is an advertising network which offers contextual advertising packages like Google’s Adsense. This is the reason why Google wanted to link with Begun in order to reduce the existing competition. The decision to buy Begun and to venture into the Russian market was decided by Google in July this year after having a discussion with Rambler Media (RMGL) which is the British registered owner of Begun (Russia’s Rambler Internet Portal). Google feels he decision to be over disappointing as the deal was earlier almost finalized for $140 million.
Though the reasons specified by FAS for not approving the deal seems to be convincing, there are also talks about the issue which says that there might also be fear factors which infer that Russia might be afraid that Google would monopolize their online internet advertising market if allowed in. The issue is still a hot talk and mystery and no one sure what would happen next regarding the issue.