Monday, July 18, 2011

U.S. Federal Trade Commission's antitrust investigation is the middle of Google 's search advertising business to investigate, say reports

U.S. regulators are willing to accept a formal inquiry into the question whether Google is abusing its dominance of the Internet to start, according to reports.

The Federal Trade Commission (FTC) is days away from serving subpoenas on the internet giant in what could be the biggest investigation yet of the search company's business, according to The Wall Street Journal. Both Google and the FTC declined to comment.

A broad investigation of Google discussed for months. Google has faced multiple antitrust probes in recent years, and is already the subject of a similar study in Europe. In the U.S. inquiries have so far been limited largely to reviews of the company 's mergers and acquisitions.

The study analyzed the heart of Google 's search advertising business and the source of most of Google' s revenue. Google accounts for about two-thirds of Internet searches in the U.S. (and almost 90% in the UK) and according to critics wrongly used to promote the dominance of their own growing network of services.

In November last year the European Commission opened its own formal investigation into allegations that Google discriminates against competing services in its search results and prevented some of the websites use ads from Google competition.

"This is a major headache for Google, even if they \ ultimately prevail in court," said Professor Christopher Yoo of the University of Pennsylvania Law School. "The U.S. and the EU share common information, and this dual investigations can be very effective."

Legal experts said the investigation could be similar in scale to the massive antitrust probe of Microsoft, which started in 1991 and ended in a settlement a decade later. Professor Joshua Wright of George Mason Law School said: "The investigation will be of a comparable scale to that of Microsoft."

But he said the chances of Google found guilty of antitrust behavior, such as Microsoft was, were much lower. Wright said that the United States to bring a successful lawsuit against Google, would have to prove it, the company was hurt consumers. "As an outsider I would say that this barrier is much higher for them today with Google than with Microsoft back then it was," he said.

Yoo said, "The reality is that changes in antitrust law in the U.S. it much harder for the government priority".

He said Google faced a higher risk in the EU case but that in either case the investigations were likely to have a profound impact on the firm.

"Even if the charges are ultimately wrong, they are many, many hours of management time and attention to occupy," he said.

The FTC 's investigations are likely to expand to other companies as official requests for information about their business with Google.

The company has long denied any anti-competitive behavior and argues that users can simply click on other options on the web.

"Our success and the disturbing nature given our business, it 's quite understandable that we' ve caused unease among other companies, and attracted the attention of regulators," Google executives wrote in a company blog post after the official European probe was launched last year.

Dominic Rushe

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