Google escapes charges in FTC anti-trust probe

4 Jan 2013

Following a 19-month anti-trust investigation into Google’s search engine practices to investigate whether the company manipulated search results to disadvantage competitors, the US Federal Trade Commission (FTC) has announced that it won’t be bringing charges against the search giant. However, Google has agreed to change some of its business practices.

After an investigation that lasted almost 20 months, the FTC has cleared Google of manipulating its search engine results to favour its own products and services and push competitors down the rankings.

However, Google has agreed to legally binding changes with the FTC to the way it presents some search results and runs its search engine advertising.

As part of the FTC settlement, Google has promised to stop using certain smartphone patents to block competitors’ mobile gadgets.

The FTC said Google will meet its prior commitments to allow competitors access ‘on fair, reasonable, and non-discriminatory terms’ to patents on technologies to make devices such as smartphones, laptops, tablets and gaming consoles.

As well as this, Google has agreed to give online advertisers more flexibility to simultaneously manage ad campaigns on its AdWords platform and on rival ad platforms.

“The changes Google has agreed to make will ensure that consumers continue to reap the benefits of competition in the online marketplace and in the market for innovative wireless devices they enjoy,” said FTC chairman Jon Leibowitz. “This was an incredibly thorough and careful investigation by the commission, and the outcome is a strong and enforceable set of agreements.”

During a press conference, Leibowitz said that the Commission had trawled through over 9m pages of documents from Google and other parties, as well as interviewing industry participants and taking the sworn testimony of key Google executives.

In relation to Google’s use of patent protection, Leibowitz had this to say: “On the patent issue, by a 4-1 vote, a bipartisan majority of the Commission orders Google to stop seeking to exclude competitors using essential patents that Motorola, which Google later purchased, had first promised, but then refused, to license on fair and reasonable terms.”

Moving on to internet search and search advertising, he said that Google would stop the practice of “misappropriating” or scraping the content of its rivals for use in its own specialised search results.

“Google will also drop contractual restrictions that impaired the ability of small businesses to advertise on competing search advertising platforms,” added Leibowitz.

Google’s chief legal officer David Drummond said in a blog post that the FTC announcement showed that “Google’s services are good for users and good for competition.”

He said that Google has written to the FTC to make two voluntary product changes. Drummond said that websites can already opt out of Google Search, while they will now be able to remove content, such as reviews from specialised search results pages.

For advertisers, Drummond said they will now be able to mix and copy ad campaign data within third-party services that use Google’s AdWords API.

“So we head into 2013 excited about our ability to innovate for the benefit of users everywhere,” he added.

In August of last year, the FTC ordered Google to pay US$22.5m to settle charges that it misrepresented privacy assurances to users of Apple’s Safari browser.

The penalty was handed down to Google for breaching a privacy settlement Google reached in October 2011 with the FTC, where the search giant promised not to misrepresent users’ control over their privacy settings.

Carmel Doyle was a long-time reporter with Silicon Republic