Dive Brief:

• Omnicom’s planned $13.5 billion acquisition of rival ad-holding group Interpublic Group cleared a key regulatory hurdle on Monday, according to a press release.   
• Omnicom and IPG reached a mutual agreement with the FTC on a consent order that bars the new company from coordinating or colluding with other firms to deny advertising dollars to publishers or platforms based on “specific political or ideological viewpoints.”
• Individual advertisers can still choose where ads are placed, per the FTC, which is under fire from advocacy groups for alleged partisan behavior. Omnicom and IPG stated their mega-deal is on track to close in the second half, as originally planned.

Dive Insight:

Omnicom and IPG are one step closer to creating the world’s largest ad agency now that the FTC consent order is squared away. All told, the regulatory challenge has not meaningfully protracted the acquisition’s timeline, though it underscores how politics are having a direct impact on the day-to-day business of advertising.

The FTC’s original complaint centered on industry coordination or collusion in directing ad spending away from publishers based on their political leanings, a practice it argues as anticompetitive. In acquiring IPG, Omnicom is expected to become the world’s largest media-investment firm, which could, in the FTC’s view, create more consolidation and heighten the potential for said collusion. In its announcement, the FTC stated that ad agencies have “a history of engaging in coordination.”  

“Coordination among advertising agencies to suppress advertising spending on publications with disfavored political or ideological viewpoints threatens to distort not only competition between ad agencies, but also public discussion and debate,” said Daniel Guarnera, director of the FTC’s Bureau of Competition, in a statement around the consent order. “The FTC’s action today prevents unlawful coordination that targets specific political or ideological viewpoints while preserving individual advertisers’ ability to choose where their ads are placed.”

This is the latest instance of ad firms landing in the crosshairs over perceived spending boycotts based around political lines. X, formerly Twitter, has filed lawsuits over alleged boycotts by advertising trade bodies since Elon Musk took over the platform in 2022. Musk until recently played a major role in the Trump administration, spearheading the Department of Government Efficiency (DOGE).   

X has threatened to sue advertisers that don’t increase spending commitments on its platform, an aggressive approach that has worked on brands like Verizon and Ralph Lauren, The Wall Street Journal recently reported. The Journal previously reported that X pressured IPG to spend more on advertising by making veiled threats against the Omnicom deal.  

Media Matters for America, a nonprofit journalism watchdog, on Monday filed a suit to block an investigation by the FTC, which it alleges comes in retaliation for the organization’s reporting on X. The investigation, which was launched while Musk was still in charge of DOGE, is “another example of the Trump administration weaponizing government authorities to target political opponents,” Media Matters said.