Google's Antitrust Dance with the FTC: Analysts Weigh In

By Todd R. Weiss  |  Posted 2012-12-20 Print this article Print

Google might have been heading on a lenient path with the FTC’s antitrust investigation, but critics may be getting the agency to be more aggressive.

More likely, however, is that the FTC is putting the issue into the background right now because of other bigger issues in the forefront in Washington today, such as the looming fiscal cliff, the upcoming Presidential Inauguration and the slow recovery of the global economy, said King.

"I think someone at the FTC is saying, 'We don't need to come out with a controversial ruling now before the holidays," he said. "Personally, I think that's probably the more likely scenario no matter what the rumors are otherwise. Doing so doesn't really hurt anybody. They’ve got much larger issues on their plate."

One of the biggest criticisms from critics of a gentle FTC approach against Google arose in November, when word got out that the settlement talks between Google and the FTC might not include a key part of the U.S. government's concerns about Google's business practices. What was missing was language addressing one of the most serious charges against Google—that it intentionally manipulates search results to harm competitors.

Instead, the talks were focusing on less controversial issues, such as how the company uses patents and how it displays comments collected from other Internet services.

Google was first notified by the FTC of a "formal review" of its business practices in June 2011 after similar reviews began in Europe. At that time, the European Commission launched an investigation into the company's search practices after vertical search engines such as Foundem, and Microsoft's Ciao complained the company favored its own Web services in search results on over theirs. They argued that this put them at a significant competitive disadvantage in the market.

The initial FTC review in 2011 began after the agency heard complaints from Microsoft, Expedia, TripAdvisor, Yelp and other Websites that Google promotes its own Web services above those of competitors.

Google denied all such allegations at that time, noting that its search algorithms analyze Website quality and popularity based on links for placement as part of its PageRank system.

In July, Google reached a record $22.5 million settlement with the FTC to resolve charges that Google bypassed Apple Safari browser privacy settings that blocked cookies for their users. The settlement was criticized by the Competitive Enterprise Institute, an industry group, as "a dangerously overbroad precedent that will chill Internet innovation and hurt online startups," the Institute said in a statement at that time.


Submit a Comment

Loading Comments...
Manage your Newsletters: Login   Register My Newsletters

Rocket Fuel