Big Yet Not-So-Surprising Antitrust News Of the Day: EU Opens Google Investigation

Josh Wright —  24 February 2010

The EU has launched its preliminary investigation of Google’s search engine and search advertising businesses.  From the Financial Times:

According to Google, one of the three complaints was from rival Microsoft. That protest, from an online service called Ciao that was recently bought by the software company, echoes a complaint that had already been lodged with regulators in Germany.

The Commission added that it had asked Google to comment on the complaints and that it was co-operating closely with national competition authorities. This procedure is standard practice when complaints are received in Brussels, and it can take some time – often months – before a decision is made either to begin a formal probe or to drop the matter.

Here is Google’s Blog Response, pretty squarely laying blame for the preliminary investigation at the feet of Microsoft:

The European Commission has notified us that it has received complaints from three companies: a UK price comparison site, Foundem, a French legal search engine called ejustice.fr, and Microsoft’s Ciao! from Bing. While we will be providing feedback and additional information on these complaints, we are confident that our business operates in the interests of users and partners, as well as in line with European competition law.

Given that these complaints will generate interest in the media, we wanted to provide some background to them. First, search. Foundem – a member of an organisation called ICOMP which is funded partly by Microsoft – argues that our algorithms demote their site in our results because they are a vertical search engine and so a direct competitor to Google. ejustice.fr’s complaint seems to echo these concerns….

Regarding Ciao!, they were a long-time AdSense partner of Google’s, with whom we always had a good relationship. However, after Microsoft acquired Ciao! in 2008 (renaming it Ciao! from Bing) we started receiving complaints about our standard terms and conditions. They initially took their case to the German competition authority, but it now has been transferred to Brussels.

Though each case raises slightly different issues, the question they ultimately pose is whether Google is doing anything to choke off competition or hurt our users and partners. This is not the case. We always try to listen carefully if someone has a real concern and we work hard to put our users’ interests first and to compete fair and square in the market. We believe our business practices reflect those commitments.

As it so happens, Geoff and I are just getting ready to send out a law review piece analyzing a potential monopolization/ abuse of dominance cases against Google through the lens of an error-cost, evidence-based antitrust framework.   So the timing is perfect!  We’ll blog about that piece in the very near future (and get it posted to SSRN).

Trackbacks and Pingbacks:

  1. La Comisión Europea estudia quejas contra Google « Políticas de Libre Competencia en América Latina - February 25, 2010

    [...] por el Océano Atlántico: entrada de N. Petit en “Chillin’ Competition” y entrada de Josh Wright en “Truth on the [...]