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Google likely to strike deal with EU antitrust regulators, says expert

Gregg Keizer, Computerworld | April 1, 2011
Microsoft's complaint about Google's business practices in the European Union will eventually push Google to strike a deal with regulators, an antitrust expert said today.

Yesterday, Smith hinted at Microsoft's expertise in the area.

"More so than most, we recognize the importance of ensuring that competition laws remain balanced and that technology innovation moves forward," he said in a lengthy blog post Thursday.

Sterling seconded that. "Microsoft could testify directly to how much monetary pain the EU can inflict," he said. "And Microsoft brings strength to the table because the EU will take seriously the concerns of such a major worldwide technology player."

But Microsoft's involvement could be a double-edged sword. Although the Commission may feel compelled to act, at least in part, out of a sense of fairness to a company it hammered last decade, Microsoft's decision to join the complainants could backfire.

"Microsoft has inherent credibility problems since it's a competitor," said Sterling. "After all, competitors usually complain when conduct increases competition and reduces prices, which is the antithesis of a legitimate antitrust complaint."

And Google could use Microsoft's own arguments in its battles with U.S. antitrust regulators to its advantage.

"Microsoft argued for years about the competitive nature of competition over the Internet," Sterling said, referring to the U.S. antitrust case that focused on Internet Explorer. "The focus has shifted from the browser to the search engine, but Google will use Microsoft's prior arguments and positions as weapons to help prove the absence of truly anti-competitive effects."

Nor is the Commission's case a slam dunk: Regulators will have to show anti-competitive behavior that has resulted in fewer choices or higher prices for consumers, not that competitors like Microsoft have been somehow harmed.

"Antitrust laws both here and in the EU are intended to protect competition, not competitors," Sterling said. "That's an extremely high burden."

But Sterling stuck to his predictive guns, and repeated his assertion that it is very unlikely Google will let this drag out to an actual ruling by the Commission.

"[EU] regulators will demand some restrictions to preserve competition [and] Google will settle this for some modest, but still substantive pro-competitive actions," Sterling said.

 

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