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Leaked US antitrust report on Google adds weight to rivals' complaints

Zach Miners | March 23, 2015
A leaked report by staff at the U.S. Federal Trade Commission paints an ugly picture of Google as a bullying monopolist and adds credence to complaints from rivals who have long criticized its business practices.

A leaked report by staff at the U.S. Federal Trade Commission paints an ugly picture of Google as a bullying monopolist and adds credence to complaints from rivals who have long criticized its business practices.

The report, which was mistakenly provided to the Wall Street Journal as part of a public records request, reveals that FTC staff concluded in 2012 that Google's business tactics had caused "real harm to consumers and to innovation," and the staff recommended a lawsuit against the company.

The FTC's commissioners ultimately decided not to take action and closed their investigation of Google. But the conduct described in the 160-page critique paints a damaging picture of the company and seems to vindicate rivals such as Yelp that have complained about its tactics.

The findings reveal, in staggering detail, the lengths to which Google went to maintain its dominance in search and bolster its lucrative advertising business.

Google typically ranks sites based on metrics like the number of links that point to a site and how often users click on those links. But at times the company boosted links to its own properties even when rival services might have better served its users, according to the report.

If a comparison shopping site from a competitor should have ranked highest, for instance, Google Shopping was sometimes placed above it. And when Yelp was deemed a more relevant result, Google Local would appear on top, the FTC staff wrote.

Google also copied, or "scraped," content from rivals such as TripAdvisor and Amazon.com, and threatened to remove those sites from its search listing if they objected, the Journal reported. In one instance, Google used Amazon's sales rankings to determine how it ranked products for its own listings, it said.

In so doing, Google sent a message that it would "use its monopoly power over search to extract the fruits of its rivals' innovations," the FTC staff wrote.

The evidence paints "a complex portrait of a company working toward an overall goal of maintaining its market share by providing the best user experience, while simultaneously engaging in tactics that resulted in harm to many vertical competitors, and likely helped to entrench Google's monopoly power over search and search advertising," the FTC staff wrote.

In a statement Thursday attributed to Kent Walker, Google's general counsel, Google said its competitors are thriving and that consumers have "more choice than ever before."

"After an exhaustive 19-month review, covering nine million pages of documents and many hours of testimony, the FTC staff and all five FTC Commissioners agreed that there was no need to take action on how we rank and display search results," Walker said. "Speculation about potential consumer and competitor harm turned out to be entirely wrong."

 

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