The FTC Accidentally Reveals Distrust of Google
posted Saturday Mar 21, 2015 by Scott Ertz
In early 2012, it was pretty clear that the Federal Trade Commission was preparing for a lawsuit against Google for anticompetitive practices through its search engine. There had been over a year of investigation that was leading the organization to believe that Google had misused its search dominance in ways that directly harmed consumers. In November of that year, after 17 months of investigation, a small excerpt of a memo leaked that recommended the lawsuit to the commission.
Two months later, in January of 2013, after 19 months of investigation, the FTC decided not to charge Google with anti-competitive practices, despite the information contained in the leaked memo. The change of heart came about with the commissioners after Google agreed to make some changes to their search content, including no longer stealing content from Yelp and presenting it as their own. Part of the end of the investigation was that the original recommendation was to be kept private.
This week, as part of a Freedom of Information Act request from The Wall Street Journal, the FTC accidentally released the rumored document along with the other information requested. As it turns out, the recommendation was 160 pages of information, all leading to the conclusion that the suit against Google should be filed. It said that Google's practices could cause "real harm to consumers and to innovation in the online search and advertising markets."
While the document paints a very clear picture of the FTC's beliefs, it is clear that something very drastic must have happened to cause a complete change of plans. Google has a very different idea of what transpired, however. Kent Walker, Google general counsel, said,
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.
So, according to Walker, in a 60 day period the staff of the Federal Trade Commission went from writing a 160-page recommendation for an antitrust suit against Google to being unanimously against that action, and there is absolutely nothing suspect about that move. Referencing Yelp, who was specifically called out for concern in the report, Walker said,
For example, Yelp calls itself the 'de facto local search engine' and has seen revenue growth of over 350% in the last 4 years.
Interestingly, 4 years is almost exactly the amount of time since Google shut down their Yelp theft practice. It certainly makes sense that Yelp's revenue would be up greatly since Google stopped stealing their content wholesale and presenting it as their own.
It is unlikely that we will ever know exactly what transpired in that 60 day period between Google and the FTC, but it is pretty clear from this document that whatever it was, it was major.
