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Google ‘faces major US antitrust probe’

By mike, Jun 24 in blog with 0 comments

The US Federal Trade Commission (FTC) is poised to open a formal antitrust probe into whether internet search giant Google has abused its dominance on the web, The Wall Street Journal reports.

The newspaper, citing ‘people familiar with the matter,’ said the FTC is preparing to serve Google with civil subpoenas ‘signalling the start of a wide-ranging, formal antitrust investigation’.

The Journal said the five-member commission will send Google the formal demands for information ‘within days’ and other companies were likely to receive requests for information about their dealings with Google.

The FTC declined to comment on the report and there was no immediate response to a request for comment from the Mountain View, California-based Google.

Google, which controls around 65 per cent of the lucrative US internet search market, has been the target of numerous antitrust investigations by the FTC and the US Department of Justice in recent years.

But the Journal said the FTC’s probe ‘is the most serious to date’ in the United States because it will examine ‘fundamental issues relating to Google’s core search advertising business’.

Google makes most of its money from search-related advertising.

The Journal said the probe will look at whether Google ‘unfairly channels users to its own growing network of services at the expense of rivals’.

European Union competition watchdogs opened an investigation into similar allegations in November.

Google has faced increasing scrutiny from US and European regulators as it has grown over the years from a scrappy startup into an internet powerhouse.

In April, the US Justice Department approved Google’s entry into the online travel sector with its $US700 million ($A665 million) purchase of flight data firm ITA Software but it insisted on a number of concessions from Google.

Several online travel sites, including Expedia, Kayak and Travelocity, had sought to block the Google-ITA deal, claiming it would give Google too much control over the lucrative online travel market and lead to higher prices.

In late March, the FTC reached a settlement with Google over Google Buzz, the social networking tool rolled out last year which spawned a slew of privacy complaints.

Under the settlement announced by the US regulator, Google is required to implement a comprehensive privacy program and will be subject to independent privacy audits every two years for the next 20 years.

Also in March, a US judge dealt a setback to Google’s plans for a vast digital library and online bookstore, rejecting a copyright settlement hammered out by the internet giant with authors and publishers.

In 2008, Google abandoned a plan to forge a joint search advertising partnership with Yahoo!, citing a desire to avert a ‘protracted legal battle’ with US regulators.

About the author

Mike Andrew has been working with the Internet and small business for over 12 years. Mike has been a keynote speaker at conventions and seminars and conducted social media training sessions all over the world. Mike has an extensive media background having worked in electronic media for over 30 years. Mike specialises in social media and Internet marketing strategy, SEO techniques and search engine marketing campaigns. His articles appear on numerous blogs around the web as well as national magazines.