Forget the Federal Trade Commission.

Investors should be more interested in

Google's

(GOOG) - Get Report

own decision about its planned acquisition of

DoubleClick

.

On Wednesday, Google CEO Eric Schmidt told a conference in South Korea that "we're quite convinced that the proposed merger meets all of the appropriate U.S. laws and is ultimately very good for consumers and for advertisers and publishers."

Most industry observers agree with Schmidt, even though Google's rivals have done their best to raise flags about the deal. Companies ranging from

Microsoft

(MSFT) - Get Report

to

AT&T

(T) - Get Report

called the deal anticompetitive when it was announced. And just this week, an unnamed industry executive (perhaps someone at a Google rival?) fanned the flames again by telling

The New York Times

that the deal was being scrutinized by the FTC.

Despite those developments, Google shareholders, who have been

victims of recent stagnancy, should be focused on how the company plans to use DoubleClick once it gets its hands on it.

More to the point, the search giant has thus far ducked questions about whether it will use search-query data to target the display advertising prowess it will now have because of the DoubleClick deal.

Linking search queries with display ad targeting would allow Google to offer advertisers a remarkably powerful combo. It would also let the company translate its strength in search into a new advertising market.

For example, Web surfers using the Google search engine to look for wristwatches would be shown rich display ads for the item when they read a news page that has ads served by DoubleClick. That scenario would be much more valuable to advertisers than having random ads displayed to random users.

Advertisers would, of course, be much better served by showing ads to users who are interested in particular items. These users would also be more likely to click on ads. Both aspects would help business at Google.

But Google has remained on the fence about such a plan. "Anything along those lines would have to -- anyway, I don't know. I think there are quite a few challenges with such a plan with respect to how we feel about privacy," Google co-founder and President of Technology Sergey Brin said during a conference call for investors

following the acquisition in response to a question about such links.

Google's hesitation to link the two types of advertisements is striking. While the company reportedly paid a steep 20 times forward revenue for DoubleClick, the price tag could be justified if it were to reap the benefits of targeting display ads based on search queries, says Roy Shkedi, CEO of online ad consultancy AlmondNet.

While Google continues to build on its dominance in search, users spend only about 5% of their time browsing search results, Shkedi points out. Much of the rest is spent on Web pages with content, and being able to link the two "would be a gold mine," Shkedi says. "It would easily justify the price they paid for DoubleClick."

Google's reluctance is particularly notable given that competitors like

Yahoo!

(YHOO)

and

Microsoft

(MSFT) - Get Report

have no hesitation in using search queries to target display ads -- an ability that will only be extended through their respective recent purchases of

Right Media

and

aQuantive

( AQNT).

Still, Google has traditionally been more sensitive than most players in the industry when it comes to issues of privacy. "They are very careful about how consumers perceive them," Shkedi says.

And that means Google shareholders should be less concerned with the FTC -- or the Department of Justice -- as they are with the less formal court of public opinion. After all, even on the remote chance that the deal is ruled out, Google would at least get its cash back.

But concerns about public image could mean that the deal goes through -- but that Google voluntarily refrains from taking full advantage of the possibilities. That would leave Google with a big bill to pay -- but without the accompanying gains to show for it.