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Antitrust subcommittee to investigate search, broadband

Grant Gross | March 11, 2011
A U.S. Senate antitrust subcommittee will investigate search and broadband competition over the next two years.

FRAMINGHAM, 11 MARCH 2011 - A U.S. Senate subcommittee focused on antitrust and consumer-protection issues will investigate competition in the search-engine and broadband markets over the next two years, the subcommittee chairman announced.

Senator Herb Kohl, a Wisconsin Democrat, listed search and broadband competition among the top issues that the antitrust subcommittee of the Senate Judiciary will explore between now and the end of 2012.

"Millions of consumers rely every day on competitive markets to keep prices low, and quality of goods and services high," Kohl, the subcommittee's chairman, said in a statement this week. "On the antitrust subcommittee we have found, in industry after industry, that the best way to ensure full and fair competition is through the vigorous enforcement of antitrust law. We will continue to work on the subcommittee to ensure that antitrust law is strongly applied."

Kohl's (KSS) focus on search-engine competition comes after complaints from some websites about the fairness of Google (GOOG) rankings. Kohl has also questioned the search-engine giant's recent acquisitions, including a planned purchase of travel and airline vendor ITA Software. In December, Kohl urged the U.S. Department of Justice to carefully review the ITA acquisition.

"Participants in the on-line travel industry are concerned that Google could refuse to make the key components of ITA software available on reasonable terms to other online travel industry participants by raising the price for a renewed license or refusing to license improvements to the software," Kohl wrote to the DOJ. "As a result, consumers would suffer harm if there is less price transparency from competing air travel search providers, which would harm consumers' ability to obtain the lowest airfares."

The antitrust subcommittee will focus on Google acquisitions and on general competition in the search industry, Kohl said in a press release.

"As the Internet continues to grow in importance to the national economy, businesses and consumers, the subcommittee will strive to ensure that this sector remains competitive, that Internet search is fair to its users and customers, advertisers have sufficient choices, and that consumers' privacy is guarded," he said in the press release. "We will closely examine allegations raised by e-commerce websites that compete with Google that they are being treated unfairly in search ranking, and in their ability to purchase search advertising."

A Google spokesman declined to comment on Kohl's agenda. The subcommittee has not scheduled hearings on search competition.

Senator Michael Lee of Utah, the ranking Republican on the antitrust subcommittee, called for hearings on Google's dominance in the search market. "The powerful position Google occupies in the general search arena creates myriad opportunities for anticompetitive behavior," Lee said in a letter to Kohl released Friday.

 

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