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January 4, 2013

Not Enough Evidence in Google Anti-Trust Claims, FTC Rules

The U.S. Federal Trade Commission (FTC) unanimously ruled Jan. 3 there is not enough evidence to support allegations Google gives its own services preferred billing in search results.

The decision, which brings to an end a nearly two-year anti-trust investigation, disappointed the company’s rivals who were gunning for strong sanctions against the search engine giant.

“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,” said Beth Wilkinson, outside counsel to the Commission.

“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.”

The FTC did, however, convince Google to change some of its business practices such as promising to license under more reasonable terms the hundreds of the patents it acquired with the purchase of Motorola. This means rivals will have access to patents on critical standardized technologies needed to make popular devices such as Smartphones, laptops, tablets and gaming consoles.

Google has also agreed to limit its use of bits and pieces from other websites and to give online advertisers more flexibility to simultaneously manage ad campaigns on Google’s 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 in a statement.

“This was an incredibly thorough and careful investigation by the Commission, and the outcome is a strong and enforceable set of agreements.”

“We are especially glad to see that Google will live up to its commitments to license its standard-essential patents, which will ensure that companies willing to license these patents can compete in the market for wireless devices,” Leibowitz added. “This decision strengthens the standard-setting process that is at the heart of innovation in today’s technology markets.”

This was not Google’s first experience with the FTC.

The search engine giant was fined $22.5-million by the agency last August to settle accusations it broke a privacy policy by “improperly tracking Apple Safari users.” The penalty remains the biggest fine the agency has imposed against a corporation for breaching a previous agreement with the agency.

Google is also still attempting to settle a similar anti-trust investigation in Europe. A resolution to that case is expected this month as well.

“Since our preliminary talks with Google started in July, we have substantially reduced our differences regarding possible ways to address each of the four competition concerns expressed by the Commission” competition policy, VP Joaquín Almunia said in a statement last month. “After meeting Eric Schmidt, executive chairman of Google, today in Brussels, I have decided to continue with the process toward reaching an agreement based on Article 9 of the EU Antitrust regulation. On the basis of the progress made, I now expect Google to come forward with a detailed commitment text in January 2013.”