Google, FTC Reach Agreement Over Search Practices, Antitrust Issues

By Ed Silverstein January 03, 2013

Google and the U.S. Federal Trade Commission have reached an agreement which has the search giant making voluntary changes after numerous concerns were raised over antitrust issues.

Following a 19-month inquiry, the FTC decided that the company was not in violation of antitrust laws when it comes to Internet search practices.

It appears to be welcome news for the company.

“The conclusion is clear,” David Drummond, Google’s senior vice president and chief legal officer, said in a recent statement on the company’s blog. “Google’s services are good for users and good for competition.”

The company made two voluntary product changes. One is that websites can remove content from specialized search results pages. These may include local, travel and shopping, the company said. The other is that websites have more ad campaign control. Advertisers will be able to mix and copy ad campaign data within third-party services that use AdWords API.

Also, Google said it will now use a neutral third party before seeking injunctions when it comes to standard-essential patent disputes. In addition, Google will not seek injunctions to block rivals from using patents essential to key technologies.

“We’re pleased that the FTC and the other authorities that have looked at Google's business practices—including the U.S. Department of Justice (in its ITA Software review), the U.S. courts (in the SearchKing and Kinderstart cases), and the Brazilian courts (in a case last year)—have concluded that we should be free to combine direct answers with Web results,” Drummond said.  

Competitors have complained that Google favors its own services when it comes to search results. But the FTC said there is no evidence that Google violated antitrust laws.

"Although some evidence suggested that Google was trying to eliminate competition, Google's primary reason for changing the look and feel of its search results to highlight its own products was to improve the user experience," FTC chairman Jon Leibowitz said in a statement on Thursday that was quoted by CBS News.

In addition, Google will change some  business practices that may “stifle competition in the markets for popular devices such as smart phones, tablets and gaming consoles, as well as the market for online search advertising,” according to a FTC statement.

Also, the company will allow “competitors access – on fair, reasonable, and non-discriminatory terms – to patents on critical standardized technologies needed to make popular devices such as smart phones, laptop and tablet computers, and gaming consoles,” the FTC added.

The FTC claims that it has required many changes at Google.

“The evidence the FTC uncovered through this intensive investigation prompted us to require significant changes in Google’s business practices. However, regarding the specific allegations that the company biased its search results to hurt competition, the evidence collected to date did not justify legal action by the Commission,” Beth Wilkinson, an attorney for the FTC commented. “Undoubtedly, Google took aggressive actions to gain advantage over rival search providers. However, the FTC’s mission is to protect competition, and not individual competitors. The evidence did not demonstrate that Google’s actions in this area stifled competition in violation of U.S. law.”

In addition, Google agreed to a settlement on allegations it was hurting competition by “misusing key mobile-device patents it acquired when it bought handset maker Motorola Mobility,” according to The Wall Street Journal.

Though the ruling from the FTC relates to the United States, European antitrust authorities continue to investigate Google. A settlement in Europe is yet to be announced and officials there “are expected to extract more extensive and binding commitments from the company as part of any legal settlement there,” according to The Journal.

In addition, Google has been warned by European regulators that it can either fix its new privacy policy or face possible fines, according to TechZone360.




Edited by Jamie Epstein

TechZone360 Contributor

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