Thursday, January 03, 2013
FTC Ends Monopoly Probe Against Google
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US regulators Thursday closed a lengthy antitrust probe
into Google, saying there was not enough evidence to
show the Internet giant manipulated its search results
to harm its competitors.
The Federal Trade Commission (FTC) announced that
Google has agreed to change some of its business
practices to resolve concerns that those practices
could stifle competition in the markets for popular
devices such as smart phones, tablets and gaming
consoles, as well as the market for online search
Under a settlement reached with the FTC, Google will
meet its prior commitments to allow competitors access
- on fair, reasonable, and non-discriminatory terms -
to patents on critical standardized technologies needed
to make popular devices such as smart phones, laptop
and tablet computers, and gaming consoles. In a
separate letter of commitment to the FTC, Google has
agreed to give online advertisers more flexibility to
simultaneously manage ad campaigns on Google's AdWords
platform and on rival ad platforms; and to refrain from
misappropriating online content from so-called
"vertical" websites that focus on specific categories
such as shopping or travel for use in its own vertical
"The changes Google has agreed to make will ensure that
consumers continue to reap the benefits of competition
in the online marketplace and in the market for
innovative wireless devices they enjoy," said FTC
Chairman Jon Leibowitz. "This was an incredibly
thorough and careful investigation by the Commission,
and the outcome is a strong and enforceable set of
The FTC also conducted an extensive investigation into
allegations that Google biased its search results to
disadvantage certain vertical websites; and that Google
entered into anticompetitive exclusive agreements for
the distribution of Google Search on both desktop and
in the mobile arena. The agency decided not to take
action in connection with these allegations.
"The evidence the FTC uncovered through this intensive
investigation prompted us to require significant
changes in Google's business practices. However,
regarding the specific allegations that the company
biased its search results to hurt competition, the
evidence collected to date did not justify legal action
by the Commission," said Beth Wilkinson, outside
counsel to the Commission. "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. The
evidence did not demonstrate that Google's actions in
this area stifled competition in violation of U.S.
Google's chief legal officer David Drummond said of the
FTC decision: "The conclusion is clear: Google's
services are good for users and good for competition."
Drummond added, "We've always accepted that with
success comes regulatory scrutiny. But we're pleased
that the FTC and the other authorities that have looked
at Google's business practices... have concluded that
we should be free to combine direct answers with Web
results. So we head into 2013 excited about our ability
to innovate for the benefit of users everywhere."
Leibowitz said Google's commitments are "binding" and
"enforceable" because the company made a written pledge
to the federal regulatory agency. Any violation of
those promises could result in fines, he said.
"This is a major victory for Google," said Greg
Sterling, an analyst with Sterling Market Intelligence
who blogs at Search Engine Land.
"The search bias argument was always one of the hardest
and most unconvincing parts of any potential case
against Google -- though it's the issue competitors
probably care most about."
However, FTC?s settlement With Google fails to end key
abuse, Consumer Watchdog says.
The nonpartisan, nonprofit public interest group
called on the Department of Justice and state attorneys
general to press forward to end the Internet giant?s
monopolistic behavior in search results.
"Google clearly skews search results to favor its own
products and services while portraying the results as
unbiased. That undermines competition and hurts
consumers," said John M. Simpson, director of the
group's Privacy Project. "The FTC rolled over for
Google. They've accepted Google executives? promises
that they will change two practices without even
requiring a consent agreement, but Google has a track
record of broken promises. Don't forget, this fall the
FTC fined Google $22.5 million for violating its most
recent consent agreement. Why would the FTC take Google
at its word?"
The new Assistant Attorney General for the Department
of Justice Antitrust Division, William J. Baer, should
make Google's abuse of search a top priority, Consumer
Consumer Watchdog expressed concern that FTC Chairman
Jon Leibowitz, who is expected to step down from the
commission soon, may have rushed to finish the
investigation so it could be concluded under his
The nonpartisan, nonprofit public interest group noted
that Google's monopolistic business practices are under
investigation by a number of state attorneys general
including Texas, California, New York and Ohio.
European Union competition officials are also