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CANNES, FRANCE With Google's deal to serve search results on Yahoo! barely one week old, it was only fitting that WPP Group CEO Martin Sorrell seated two executives from the companies side by side at a panel discussion he moderated here today at the International Advertising Festival.

The WPP chief wasted little time in showing his skepticism about Google's growing power on the Internet.

Sorrell quickly veered from the stated topic, "From Metrics to Brand: Online's Next Challenge," in order to question the "love affair" between Google and Yahoo! and instances of Google bypassing agencies to get directly to clients.

He ultimately hinted that Google was not living up to its word.

Sorrell referenced Google CEO Eric Schmidt's pronouncement at the Davos economic summit that the company wanted to make inroads in advertising and marketing services, also noting Google's hire of Ogilvy & Mather New York co-president Andy Berndt.

Was Google trying to "disintermediate" ad agencies? Sorrell asked.

"At the end of the day, we're a technology company," said Henrique de Castro, managing director of European sales at Google. "We're definitely not an ad agency."

Sorrell probed whether Google is going directly to clients and cutting out ad shops -- a complaint heard from agency executives here this week.

De Castro said the company is only hungry for change, and while it might discuss programs directly with some advertisers, that wasn't its preference.

Sorrell accused Google of saying one thing while doing another, and asked whether that was because of internal disorganization or an "orchestrated scheme."

"We've tried to do a lot of experimenting," de Castro said. "It's very iterative. The overall trend is [that] we work better and better with agencies."



When it comes to search, Sorrell noted that WPP spent about $800 million with Google, roughly 5 percent of its revenue. With most media companies, its share of revenue would be five times as much, potentially giving the holding company less leverage if Google were to start acting in ways contrary to WPP's interests.

Kevin Johnson, president of Microsoft's platforms and services division, echoed many of Sorrell's concerns, no surprise in light of Microsoft recently scrapping its bid to acquire Yahoo! or at least combine with its search business.

"We think the industry is better served if there are 'n' number of players and 'n' is greater than one," he said.

Hillary Schneider, evp of Yahoo!'s global partner solutions division, reiterated that her firm remains committed to search, painting the deal with Google as part of its effort to create an open system.

"We are avidly committed to being a principal in the search marketplace," she said.

Yet, Sorrell openly wondered whether the deal creates an effective monopoly in the key search market.

He has a long history of eying Google warily, and he once coined the term "frenemy" to describe the technology giant.

On stage at Cannes, Sorrell used a new variation for the relationship between the No. 2 holding group and Google: "froes."

That view is mistaken, Digitas CEO David Kenny said in a later interview. (Publicis Groupe, parent company of Digitas, has inked a deal with Google allowing the companies to exchange employees and work together to develop systems that would make it easier to buy, target and measure online advertising.) Kenny sees treating Google as a threat counterproductive.

The aim for Google is merely to make the market more efficient and transparent. The key will be making sure it remains transparent. If there is transparency, even the Google-Yahoo! deal doesn't trouble Kenny because it would actually offer advertisers multiple ways to buy listings on Yahoo!, potentially creating a more efficient market.



"I don't think they have any desire to be in the agency business," said Kenny, who serves as the top digital strategist of Publicis. Of Google going direct to clients, he added, "They feel their story isn't getting out and want it to be told. A lot of the agency world doesn't like that story."

Sorrell apparently does not like what he's heard of Google's story.

At one point, Sorrell asked several questions in a row, as the other panelists looked on. De Castro gave away little, offering standard responses from Google executives by pointing out that Google's auction determines prices and it seeks to work with many partners, preferably ad agencies. Sorrell asked if Google's algorithms would end up replacing many people employed by the ad industry.

"We're not going to replace the people in the advertising world," de Castro said. "It's not where we want to be.