Discover what's up in the business of marketing each Friday.
Google Likely To Face US Antitrust Case Later This Year
Bloomberg provides more evidence of a coming antitrust investigation of Google by the US Federal Trade Commission (FTC) or Justice Department. We’ve now been hearing these kinds of statements and suggestions — from various “unnamed sources” and “people with knowledge of the matter” — for months. The Bloomberg article says that the ITA-acquisition decision could come very soon, followed by a potentially broad probe of Google.
It’s still not clear whether the government will attempt to block the ITA acquisition. My original thought when the deal was announced last year was that it would; however the US could also allow the acquisition with strict conditions.
Comparable to the Microsoft Investigation?
There’s an expert comment in the mostly speculative Bloomberg piece about a Google investigation being “on par” with the one conducted against Microsoft more than a decade ago. Though a judge (in 2000) found that “Microsoft maintained its monopoly power by anti-competitive means and attempted to monopolize the Web browser market,” the company was mostly just embarrassed by the ruling.
During the remedial phase of the process the Bush Administration shifted enforcement to the various states and the case mostly disappeared. In Europe it was a different story, as legal actions against Microsoft went on for a number of years and resulted in more than $2 billion in fines.
Right now the European Commission is in the middle of an antitrust investigation against Google. The Europeans seem intent upon imposing some sort of punishment, controls and/or fines upon Google. This has started to happen in litigation and regulatory actions in individual European countries, most recently in Switzerland with Street View.
Bipartisan Call for Investigation
In this country Texas has already undertaken a formal investigation against Google’s business practices. Other states, such as Ohio, are considering similar moves. There’s also bipartisan support for investigating Google in Congress.
Recently, Wisconsin Senator Herb Kohl, the head of the Senate Judiciary Subcommittee on Antitrust, said that Google would be the subject of scrutiny by his committee this session in Congress. Many Republicans have also called for investigations of Google.
There are a range of statutes that the government could invoke in an antitrust investigation or to negotiate a settlement with Google. Any potential remedies would largely depend on specific competitive violations found. However as I’ve discussed previously any effort to regulate SERPs themselves are highly problematic and largely unworkable.
Regardless of whether there’s a formal US antitrust inquiry against Google, life will ultimately go on. There potentially could be fines, restrictions of some sort or some sort of audit or monitoring, as with the FTC’s recent, excessive privacy settlement with Google. But just as Microsoft survived the government’s investigation (so have others such as Intel) Google will survive and probably continue to thrive on the other side.