Looks Like Google Might Not Be Getting That Sweetheart Deal From the FTC
After continued leaks and reports that the U.S. Federal Trade Commission would go easy on Google with an antitrust settlement expected this week, the tide seems to be turning.
The FTC will likely push its deliberation on Google’s competitive practices into next year so it can continue to study the matter, The Wall Street Journal and Bloomberg are reporting, and we have confirmed independently.
That news follows a statement today from the European Commission that it was also working to settle with Google, but for a firmer agreement than what the FTC was reportedly getting.
After meeting today with Google Chairman Eric Schmidt in Brussels, EC competition chief Joaquin Almunia had said he expected Google to submit a “detailed commitment text” in January. He said he hoped the process would lead to a binding decision that was “market-tested” and would include remedies for the alleged bias in Google’s search results toward its own offerings.
The FTC, which had let it be known it wanted the matter finished before the end of the year, was getting none of those concessions.
The FTC’s would-be settlement was widely reported to have been a) voluntary and non-binding, b) not available for a public comment period as it would have been with a consent decree and c) over different issues than search bias, which is the most crucial and controversial topic.
A bad situation for the FTC was made to look worse when Europe claimed it was extracting bigger concessions from Google. Plus, sources said, the state attorneys general in the U.S. were none too happy about being cut out of the proposed deal.
Google declined to comment on the matter, as did the FTC.
At least according to close observers of the case, public attention to the matter seems to have been a significant factor in the decision to reopen it. “The last thing you want to do is call attention to a weak settlement,” said one source.
So now it’s back to the drawing board for the FTC, which had imposed on itself an urgency in the case that seems to have hurt its ability to negotiate.
But the clock is still ticking on the FTC for a couple of reasons. New FTC commissioner nominee Joshua Wright, who is waiting to be confirmed to replace Thomas Rosch, has already said he will recuse himself from Google-related cases for two years because some of his research has been funded indirectly by the company. In addition, FTC Chairman Jon Leibowitz, who has led the charge against Google — but weakened his case by making it known he expected to leave office soon — still probably wants to leave office soon, but hopefully with his legacy a bit more intact.
So even if the FTC has given itself a reprieve to negotiate further, it’s unlikely to be a very long one.
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