Publicis Groupe has received approval from the US Federal Trade Commission to acquire LiveRamp for $2.2bn, subject to a proposed consent order unveiled on Monday. The deal hinges on a binding five-year commitment requiring both companies to maintain fair treatment of all customers.
Under the settlement terms, Publicis must guarantee every LiveRamp customer receives "non-discriminatory access and support on fair and reasonable terms". The company is prohibited from denying, degrading, delaying or impairing that access. Additionally, Publicis must establish data firewalls to prevent itself from viewing or leveraging information that rival agencies' clients transmit through LiveRamp.
In a statement, Publicis indicated that these commitments were "proactively proposed by the Groupe". The company anticipates finalizing the transaction before year-end.
The FTC's Competition Concerns
LiveRamp operates a data connectivity platform that enables advertisers to securely transfer information underlying digital advertising campaigns. Since Publicis specializes in media planning and purchasing for brands, its prospective ownership of LiveRamp raised regulatory red flags: the agency's competitors depend on a tool it would soon control.
The FTC's complaint outlined how the acquisition would furnish Publicis with "the ability and incentive" to steer rival clients toward its own services. The regulator suggested Publicis could systematically degrade competing agencies' access to LiveRamp, forcing them to switch. Furthermore, the agency would gain sight of "competitively sensitive data" concerning clients outside its current portfolio.
The FTC contended that permitting the merger would diminish competition in both media agency services and audience data services, thereby violating Section 7 of the Clayton Act.
By requiring LiveRamp to continue operating as it does today as a neutral platform, this order will ensure that Publicis does not gain an unfair advantage over its competitors in the digital advertising marketplace
David Shaw, principal deputy director of the FTC's Bureau of Competition
Oversight Mechanisms and Next Steps
An independent auditor will conduct compliance reviews every six months for the first two years following deal closure. The frequency then decreases to annual inspections over the subsequent three years. Any LiveRamp customer retains the right to request an audit examining how Publicis handles its data.
Publicis faces restrictions against retaliating against clients who lodge complaints with the FTC. Should disputes remain unresolved after 30 days, they proceed to third-party mediation.
The settlement represents a behavioural remedy without requiring asset divestiture, making it less stringent than the oversight framework a US judge imposed on Google's ad tech operations, which includes a six-year monitor.
The commission voted 2-0 to advance the agreement for public comment, with both votes originating from its Republican commissioners, according to Bloomberg. The public has 30 days to submit feedback before the FTC determines whether to finalize the order.
LiveRamp's stock climbed 2.4% following the announcement, Bloomberg reported. Publicis announced the acquisition in May. The transaction follows Nielsen's acquisition of DoubleVerify, which closed in August for $2.15bn.
Apple's Parallel Restrictions on Identity Tools
The FTC's approval arrives as Apple moves to exclude identity resolution tools from Safari. Apple's WebKit team released its rationale late Monday for blocking what it terms identity resolution infrastructure. LiveRamp's domains appear on the blocked list alongside The Trade Desk, ID5, Permutive and Audigent, according to Business Insider.
Apple has progressively strengthened Safari's privacy protections over recent years. This latest action means Publicis is investing $2.2bn in a business whose capacity to reach iPhone users continues to diminish.
Regulatory pressure on the advertising sector extends beyond this deal. The FTC is simultaneously pursuing legal action against Amazon regarding its ad auction pricing practices.
Source: The Next Web
