FTC is going to sue Google for anti-competitive behavior, according to reportsOctober 12, 2012 2 Email article | Print article
When I say “Google dominates search” no one is likely to disagree with me because it is true — Google is the most popular search engine around the world (on an aggregate basis — some countries, like China, prefer other search engines). When you dominate one industry, there are bound to be allegations of anti-competitive behavior and Google has received its fair share.
Over the past few years, multiple companies have complained, to the US Congress and other entities, that Google gives higher search ranks to its own products and websites than the competition. For example, Yelp alleges Google unfairly gives priority to Google Local Search over Yelp (which is a company that specializes in local search). Reuters is reporting that “three people familiar with the matter” claim the Federal Trade Commission of the USA (popularly known as the FTC) has been looking into allegations against Google over the past year and is close to making a decision. Unfortunately for Google, four of the five FTC commissioners are convinced that Google has indeed violated anti-trust law; the fifth is “skeptical”. Two of the three sources claim a final decision by the FTC will come as early as the end of 2012, meaning the FTC and Google could soon be butting heads.
What exactly can we expect to happen? I’m sure Google and FTC will first try to come to a settlement. My guess is the settlement will be more of a slap on the wrist for Google than anything with teeth. If a settlement is not reached, then FTC will take Google to court… and who knows what can happen there.
For its part, Google has denied the allegations. When asked about the FTC’s probe, Google spokeswoman Niki Fenwick said:
We are happy to answer any questions that regulators have about our business.
And last year in September, during a congressional hearing held by the Senate Judiciary Committee’s anti-trust panel, then Google CEO Eric Schmidt proclaimed:
May I simply say that I can assure you we’ve not cooked anything.
Google, of course, has always held its head high for standing up against censorship. However, if these allegations indeed prove to be true then it would indeed be a dark mark in the search giant’s permanent file.
To make matters worse for Google, it is believed that the European Union’s Competition Commission is probing Google for the same allegations in Europe and the FTC is said to be looking into patent abuse by Google related to smartphones (uh… what about Apple?).
For what it is worth, as a consumer I don’t give a damn if Google is giving priority to its services over other services simply because Google is the king of data — they typically provided better services that are data-driven than anyone else. On the flip side, fair competition is essential for the promotion of small businesses, start ups, and innovation. So I applaud any steps by our government to stop big business from pushing the little guy around. While it does sound a little absurd that Google is getting in trouble for promoting Google services on Google’s search engine, that is just how things are when you are the big fish. Let’s see what happens.