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Sir Martin Sorrell, chief executive of WPP, the advertising services giant, today became the latest industry figure to raise concerns over Google's agreed $3.1 (£1.5bn) acquisition of DoubleClick, the largest broker of online display - or banner - adverts.
The comments came just hours after Google reported a 69 per cent rise in first-quarter profits, to $1 billion (£500 million), again beating analyst expectations and cementing its position as the most profitable group on the web.
DoubleClick's position as a buyer and seller of advertising space on the web makes it privy to vast amounts of data on the behaviour of consumers online, which is captured to improve the effectiveness of campaigns.
Sir Martin told Reuters that Google's planned acquisition of the group “raises issues as to whether we are happy to let Google have our client’s data and our own data which Google could use for its own purposes in contextual and targeted advertising.”
He added that the deal also raised competition concerns, "There are regulatory issues which a number of media owners, publishers and competitors like Microsoft are very exercised about," he said.
Microsoft, which also tried to buy DoubleClick, and AT&T, the telecoms group have both raised objections to the deal.
In its figures, Google revealed that UK revenues were $578 million (£288.6 million), up 68.5 per cent on last year, to account for 16 per cent of the $3.66 billion company total. British growth was slightly faster than the company as a whole, where sales were up 63 per cent.
In contrast, the UK was WPP's slowest region for revenue growth, according to its first-quarter results, also reported today. UK revenues were up 2 per cent on a year earlier in the first quarter, at £207 million.
Overall, WPP revenues were down 1 per cent, to £1.4 billion, hit by the weak dollar. On a constant currency basis, underlying revenues were up 4.3 per cent.
Google, the leader in search-based online advertising has now surpassed Wall Street forecasts in all but one of its 11 quarters as a listed company. Shares in the group rose more than 3 per cent in extended trading, to close at $471.65 on the Nasdaq.
Eric Schmidt, chief executive, said: “We are ecstatic about our financial results this past quarter.”
Mr Schmidt also became chairman of the board, it was announced overnight.
It was the second consecutive quarter in which Google posted $1 billion in profits.
The figures were flattered by a favourable tax rate of 26 per cent during the first quarter, below the company’s projected rate of roughly 30 per cent for the full year.
The results will increase the pressure on Terry Semel, the chief executive of Yahoo!. Google's closest rival in online advertising revealed an 11 per cent decline in its first-quarter profits earlier this week, to $142 million, as advertising revenue growth failed to meet expectations.
In line with past quarters, the lion’s share of profits came from Google’s search business. Its reliance on its market leading search engine, which accounts for about half the US market, has prompted the company to diversify, most recently by agreeing to buy DoubleClick, the largest independent broker of display advertising on the web, for $3.1 billion.
Google is also investing heavily to accommodate its growth by hiring workers and adding computer capacity at the giant data centres it uses to run web-based applications, such as it Premier Apps tools, rivals to Microsft products such as Office.
The company spent $597 million on capital expenditures in the first quarter and hired another 1,564 employees to expand its workforce to 12,238 people
However, Google still finished the quarter with $11.9 billion in cash on its books.
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