A View from Jessica Leber
Google Gets A Pass in U.S. Antitrust Investigation
The Federal Trade Commission says the search giant does not illegally stifle competition after a nearly two-year inquiry.
Google, the company synonymous with search, came to a settlement with the Federal Trade Commission today in a high-profile antitrust case that involved 9 million pages of testimony. The decision is an important victory for Google, even though it agreed to some concessions that would give competitors access to key mobile patents and make it easier for advertisers to use rival search engines.
One big question was whether the company unfairly stifles competition by favoring its own search “verticals,” such as shopping, local or travel, or demoting the rankings of rival services in its search results.
The FTC decided that there wasn’t enough evidence to justify legal action. “Undoubtedly, Google took aggressive actions to gain advantage over rival search providers. However, the FTC’s mission is to protect competition, and not individual competitors,” said the FTC’s outside counsel Beth Wilkinson.
The FTC’s decision seems fairly conclusive. According to the Wall Street Journal, Google will continue to allow companies like Yelp to opt-out of having their pages “scraped,” a practice that allows snippets of text to appear in Google products like Maps. And it has promised it won’t demote search results of companies that opt-out. It’s fairly concerning, however, that the FTC is going to trust Google to maintain neutrality going forward, and doesn’t plan to monitor its search algorithm for bias.
Micorosoft, Expedia, and other Google competitors, grouped together as coalition called FairSearch.org, believe, unsuprisingly, that the FTC rushed its decision. The claim has merit, since the European Commission is still separately negotiating with Google over a similar set of issues. In Europe, however, the antitrust stakes are higher. There, Google dominates about 90 percent of the search market, unlike in the U.S., where Yahoo and Microsoft’s Bing together have about a 40 percent market share.
The FairSearch group writes:
A key question for the FTC is whether it has all the relevant information in hand when it makes its enforcement decision…FairSearch remains convinced that US consumers and innovators deserve the same protections that the European Commission may adopt in Europe.
It’s also notable that the FTC’s investigation took almost two years. As Forbes contributor Eric Goldman points out, that is too long to match the rapid pace of technology development on the Web.