FTC reportedly eyes antitrust probe of Google: Is search giant too dominant?
The Federal Trade Commission is reportedly ready to serve Google with subpoenas in a broad antitrust investigation. According to the Wall Street Journal, the FTC is ready to investigate whether Google is abusing its dominance of the Web. CNET News is reporting that a U.S. Senate committee probing antitrust and Internet search topics is threatening to subpoena Google CEO Larry Page or Chairman Eric Schmidt in the next month or so.
No one is commenting and the Journal cited people close to the matter. At issue is Google's position in search advertising and whether it is using its results to channel users to its own sites at the expense of rivals. The investigation comes as Google is expanding into areas such as mobile via Android, display advertising and local deals and coupons.
It's unclear how the investigation will impact Google's operations, but history provides a quick guide. Typically, these antitrust investigations make the target company less competitive. After all, companies under the antitrust microscope try to stay out of trouble and that means paring back their natural competitive impulses.
For instance, you could argue that Microsoft became less competitive after its high profile battle with the Department of Justice in 1998. The DOJ initially wanted to break up Microsoft, but then backed off. The Microsoft suit revolved around the company using its operating system dominance to push its Internet Explorer browser. Microsoft settled with the DOJ in 2001.
Since that settlement, Microsoft has missed the tech curve in a few key areas---notably mobile. Microsoft had to watch its bundling practices going forward.
Google could be in a similar position. For instance, Google could theoretically have to minimize its own properties such as YouTube. That could open the door to other video players.
Oddly enough, Microsoft's Bing search engine could stand to benefit the most from Google's antitrust issues. If Google were found to be using its search results to push its own properties.
The idea of an antitrust investigation against Google has been circulated widely in recent years. For instance, Wharton professor Eric Clemons had sketched out what an antitrust lawsuit would look like in 2009. Here's a video of Clemons' take on a Google antitrust suit.
And here's Clemons' presentation on Google and antitrust.