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Google May Face Antitrust Investigation

Monday, 11 April 2011 05:04 By Nadia Prupis, Truthout | Report

The Federal Trade Commission (FTC) and the Department of Justice (DOJ) are considering launching an antitrust investigation into Google's dominance over the Internet search industry.

The DOJ recently approved Google's $700 million deal with travel company ITA Software, but antitrust regulators are concerned that the acquisition may threaten competition in the travel information industry; specifically, the FTC is worried that Google could use the software to direct users to its own sites, depriving similar web sites such as Orbitz, Kayak and TripAdvisor of fair competition.

ITA creates online software that allows airline companies to offer flight and ticket information over the Internet. The investigation would look into Google's plans to utilize ITA's software in its search engine and whether those practices violate regulations meant to ensure a competitive marketplace online.

Sen. Herb Kohl (D-Wisconsin), a leading member of the Senate Judiciary Committee on Antitrust, Competition Policy and Consumer Rights, recently urged the DOJ to launch a "careful review" of the company's acquisition and pledged to have the committee do the same.

"In our review of the Google/ITA merger, we urged that the Justice Department take action to maintain [a] highly competitive marketplace ... It's essential that this deal not interfere with the ability of competing online travel services to utilize ITA software, nor interfere with the vibrant competition that allows consumers to find the best bargains in the online travel industry today," Kohl said in a statement.

"We continue to scrutinize broader questions about the fairness of Google's search engine and whether it preferences its own products and services to the detriment of competitors," Kohl stated.

If a US probe goes though, it would follow in the footsteps of the European Commission, which has been investigating Google's behavior toward competitors since February 2010, when several small companies filed formal complaints against the search giant for allegedly utilizing its dominance in the market to unfairly promote its products.

In November, Microsoft filed its own complaint with the European Commission against Google, accusing the company of "walling off" content on its YouTube site. The dispute marked the first time Microsoft had ever made an antitrust complaint against another company.

Microsoft also claimed that Google was slowing YouTube content on Windows Phone, preventing its users from accessing content at the same speed as Android users.

"[We're] concerned by a broadening pattern of conduct aimed at stopping anyone else from creating a competitive alternative" to Google, Microsoft Corporation Senior Vice President and general counsel Brad Smith wrote in a blog post.

"It's ... critical that search engines and online advertising move forward in an open, fair and competitive manner," Smith wrote. "We readily appreciate that Google should continue to have the freedom to innovate. But it shouldn't be permitted to pursue practices that restrict others from innovating and offering competitive alternatives."

At the same time as the DOJ approved the ITA deal, its Antitrust Division also filed a civil lawsuit with the US District Court in Washington, DC, to block the acquisition. The DOJ aims to settle the conflict by "[promoting] robust competition for airfare websites by ensuring those websites will continue to have access to ITA's pricing and shopping software," said Joseph Wayland, the DOJ Antitrust Division deputy assistant attorney general. Google agreed to license the software to competing companies. The DOJ also mandated that Google not receive any proprietary information about customers.

"It's important to us that ITA continue with business as usual," Jeff Huber, Google's senior vice president for Commerce and Local, wrote in a blog post following the approval of the deal.

Nadia Prupis

Nadia Prupis is Truthout's Media Policy Reporting Fellow.


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Google May Face Antitrust Investigation

Monday, 11 April 2011 05:04 By Nadia Prupis, Truthout | Report

The Federal Trade Commission (FTC) and the Department of Justice (DOJ) are considering launching an antitrust investigation into Google's dominance over the Internet search industry.

The DOJ recently approved Google's $700 million deal with travel company ITA Software, but antitrust regulators are concerned that the acquisition may threaten competition in the travel information industry; specifically, the FTC is worried that Google could use the software to direct users to its own sites, depriving similar web sites such as Orbitz, Kayak and TripAdvisor of fair competition.

ITA creates online software that allows airline companies to offer flight and ticket information over the Internet. The investigation would look into Google's plans to utilize ITA's software in its search engine and whether those practices violate regulations meant to ensure a competitive marketplace online.

Sen. Herb Kohl (D-Wisconsin), a leading member of the Senate Judiciary Committee on Antitrust, Competition Policy and Consumer Rights, recently urged the DOJ to launch a "careful review" of the company's acquisition and pledged to have the committee do the same.

"In our review of the Google/ITA merger, we urged that the Justice Department take action to maintain [a] highly competitive marketplace ... It's essential that this deal not interfere with the ability of competing online travel services to utilize ITA software, nor interfere with the vibrant competition that allows consumers to find the best bargains in the online travel industry today," Kohl said in a statement.

"We continue to scrutinize broader questions about the fairness of Google's search engine and whether it preferences its own products and services to the detriment of competitors," Kohl stated.

If a US probe goes though, it would follow in the footsteps of the European Commission, which has been investigating Google's behavior toward competitors since February 2010, when several small companies filed formal complaints against the search giant for allegedly utilizing its dominance in the market to unfairly promote its products.

In November, Microsoft filed its own complaint with the European Commission against Google, accusing the company of "walling off" content on its YouTube site. The dispute marked the first time Microsoft had ever made an antitrust complaint against another company.

Microsoft also claimed that Google was slowing YouTube content on Windows Phone, preventing its users from accessing content at the same speed as Android users.

"[We're] concerned by a broadening pattern of conduct aimed at stopping anyone else from creating a competitive alternative" to Google, Microsoft Corporation Senior Vice President and general counsel Brad Smith wrote in a blog post.

"It's ... critical that search engines and online advertising move forward in an open, fair and competitive manner," Smith wrote. "We readily appreciate that Google should continue to have the freedom to innovate. But it shouldn't be permitted to pursue practices that restrict others from innovating and offering competitive alternatives."

At the same time as the DOJ approved the ITA deal, its Antitrust Division also filed a civil lawsuit with the US District Court in Washington, DC, to block the acquisition. The DOJ aims to settle the conflict by "[promoting] robust competition for airfare websites by ensuring those websites will continue to have access to ITA's pricing and shopping software," said Joseph Wayland, the DOJ Antitrust Division deputy assistant attorney general. Google agreed to license the software to competing companies. The DOJ also mandated that Google not receive any proprietary information about customers.

"It's important to us that ITA continue with business as usual," Jeff Huber, Google's senior vice president for Commerce and Local, wrote in a blog post following the approval of the deal.

Nadia Prupis

Nadia Prupis is Truthout's Media Policy Reporting Fellow.


Hide Comments

blog comments powered by Disqus