Google’s FTC Antitrust Probe Will Drag On As EU Revs Up

Google‘s US antitrust inquiry looks set to continue, since the Federal Trade Commission (FTC) appears to have rejected a rumoured settlement as inadequate. Meanwhile, the European Commission is preparing action over claims that the company is abusing its virtual monopoly on Internet searches.

This month, the US regulator had hoped to finish the investigation it started in 2011, which examines whether Google gives its own products priority in search results, for example pushing its travel products at the expense of rivals such as Microsoft Expedia, Yelp and TripAdvisor. It was widely reported that Google had offered to make small changes to the way searches were presented in exchange for a token punishment, but now it seems the investigation will continue into 2013 – and maybe turn into a full-blown legal case.

FTC readies bigger slap for Google?

Google’s supposed deal with the FTC was based partly on making it easier for rivals to buy ad space on the search site, according to the Wall Street Journal, but other details were scarce. The deal appears to have fallen apart under protests from rival players that it would not have gone far enough, according to the New York Times.

If a full-scale legal case emerges, it would be the largest since the FTC’s case against Microsoft 14 years ago over complaints that the software firm had abused its monopoly of desktop operating systems – a case which stopped short of breaking the company up.

The FTC is likely to rule more quickly in a parallel case which alleges Google is misusing patents required for industry-standard technologies, which  it acquired when it bought Motorola’s phone division for $8 billion. The expected solution is for Google to promise to keep the patents available under FRAND (Fair, Reasonable And Non-Disciminatory) terms, and not sue rivals for using them, as stated in the conditions of the deal to buy Motorola Mobility.

Meanwhile, the European Commission is just getting warmed up. Google chairman Eric Schmidt met EU competition commissioner Joaquin Almunia (pictured) on Tuesday this week.

European antitrust rulings are likely to be tougher on Google than those from the US FTC, says the New York Times – and this would echo the experience of Microsoft on both continents. The regulator has given the search giant a month to come up with a response that satisfies the regulator, or it could face fines – which in theory could be as large as $4 billion (ten percent of the firm’s revenue).

Google proposed changes to its processes earlier this year, but these didn’t go far enough for the European regulators.

So regulators will be working over Christmas? Take time off with our Christmas quiz!