Regulators in crunch meeting over Google competition probes
Published 03/12/2012 | 10:41
GOOGLE could face a costly and damaging battle with competition regulators on both sides of the Atlantic after a crunch meeting tomorrow.
Or, as its rivals and critics fear, intensive lobbying in Washington DC could both put the brakes on formal punishment in the United States, and provide Google with a weapon in its battle with the European Commission.
Jon Leibowitz, the chairman of the Federal Trade Commission, is in Brussels for a meeting with Joaquín Almunia, the vice-president of the European Commission, who holds the competition brief. Both men have been examining whether Google abuses its dominance of the general web search market to unlawfully promote its own sideline businesses, such as shopping comparison, while relegating rivals.
Mr Almunia has already reached the conclusion that it does, and has called on Google to offer to make changes to how its search engine works, or face formal antitrust enforcement action of the type that cost Microsoft billions in fines, legal fees and damage to its reputation.
Mr Leibowitz, meanwhile, who won an inside-the-Beltway tussle to run the US antitrust investigation of Google rather than the Department of Justice, appears to be wavering. The small armies of lawyers and lobbyists following the case believe that Google has convinced him to stop short of enforcement action over alleged manipulation of search results.
Instead, it’s claimed, he may attack areas such as Google’s search patents, which do notgot to the heart of its business in the same way.
“There’s a sense that Leibowitz is weak against Google,” said one critic. “We’re in a dicey situation this week.”
As recently as mid-November, Google’s rivals, who include Microsoft and Yahoo! in general search, and a plethora of small niche players who have banded together against it, were given cause for hope. It was reported that the FTC’s investigators had found fault in the way Google operates, and that like Almunia, Leibowitz had issued an ultimatum for the firm to come up with solutions or face action.
“But Google just came in a called his bluff,” said a Washington DC source. “Leibowitz has already said he wants to leave the FTC next year, and Google can use that to pressure him into a dropping some of the allegations.”
For the European Commission, a major concern is that if the firm has succeeded in convincing American regulators its search rankings do no harm, their own case could be weakened.
Google’s enemies have vowed to fight on in the United States even if Mr Leibowitz will not take up their cause, however.
“The FTC and Leibowitz will be judged on this,” warned one senior technology lawyer. “If they fail to act then there will be a strong push for the Department of Justice and state District Attorneys to step in.”
The European Commission said Mr Almunia plans to discuss “competition policy” with Mr Leibowitz.
Google denies abuse of its search market share, which stands at two thirds of the American market and more than 90 per cent in Europe. It says it is cooperating with investigators on both sides of the Atlantic.
Staying Mr Leibowitz's hand would mark a major victory for Google in the most serious of its ongoing skirmishes with regulators. It also faces new laws in Germany that would force it to pay publishers for linking to articles, and has publicly claimed that a UN telecoms meeting this week in Dubai will see an internet power grab by governments
By Christopher Williams Telegraph.co.uk