Editor’s Note: The following discussion notes that “dominant technology-oriented U.S. corporations are a favored target of the Antitrust Division.” What is not explained is why America’s most innovative and globally competitive companies are targeted for investgation without clear cause.
From: Patton Boggs LLP
Google Inc. has come under increasing scrutiny by the DOJ and FTC as well as foreign regulators for alleged anticompetitive conduct in its search and advertising practices. In June 2011, Google received a subpoena from the Federal Trade Commission (FTC) arising from a civil investigation into Google’s dominance in the search industry. The chief concern appears to be whether Google directs users to its own non-search services instead of similar services offered by Google competitors. The European Commission has already opened a similar investigation. As we previously noted, Google set aside $500 million in May in connection with a DOJ investigation of the use of Google ads by “certain advertisers.”
Congress has decided to weigh in as well. Eric Schmidt, Google’s chairman, has agreed to testify before the Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights. The subcommittee is investigating competition issues in the Internet search market.
Presently, the FTC and DOJ investigations are in their early stages and the exact scope of the inquiries is still vague. The myriad claims by Google critics include allegations of intentional manipulation of search results to favor Google-affiliated companies or services; displaying search results in ways that unfairly favor Google’s own services; and misappropriation of other companies’ content. Despite this variety of complaints, none have been established or proved.
Given Google’s size and dominance as well as the high number of competitors/critics, government scrutiny should come as no surprise. Google generates a significant share of its revenue from online advertising that appears alongside search engine results, revenue that could exceed $35 billion this year. Over two-thirds of all Internet searches in the U.S. are reportedly conducted via the Google search engine.
News of DOJ and FTC investigations proves nothing and falls well short of civil complaints or criminal charges. Historically, though, dominant technology-oriented U.S. corporations are a favored target of the Antitrust Division.
Leave a Reply