Liz Gannes

Recent Posts by Liz Gannes

FTC Chairman Pushing for a Google Antitrust Decision This Week

It’s likely that the Federal Trade Commission will rule on its antitrust investigation of Google this week, with a similar settlement to the one discussed before the December holidays, according to multiple sources familiar with the matter.

leibowitz2The FTC had seemed ready to agree to a non-binding settlement with Google in late December, but it pushed back a decision after it seemed that the European Commission was still in the fight for a stricter deal.

Now, FTC Chairman Jon Leibowitz is behind a charge for the FTC’s five commissioners to vote on the same issue this week.

What’s changed? Well, the Senate confirmed George Mason law professor Joshua Wright late Tuesday to replace Commissioner Thomas Rosch. Rosch’s last day is Friday. Due to a previous relationship with Google, Wright will recuse himself from the case.

But then again, Rosch was not expected to vote against Google, especially given that he said last month that the company’s competitors should take their antitrust claims to court rather than “free-ride on the government.” So the number of votes needed hasn’t really changed at all.

The other thing that’s evolved in the past month is that after descriptions of the Google-FTC settlement leaked, it was perceived as weak compared to what Europe was still negotiating.

The proposed U.S. settlement includes a resolution about scraping content for use in Google’s search “snippets,” a requirement for AdWords data to be portable onto other platforms and restrictions about when injunctions can be sought over standards-essential patents.

These so-called “voluntary commitments” seemed markedly weaker than the “binding” and later to be “market-tested” agreement that EC competition commissioner Joaquin Almunia said in a public statement he was still hoping to get from Google before the end of January.

Not wanting to hurt its leverage in future cases, the FTC took a step back to think about how this was being perceived, sources said.

But if a vote were to come this week, it would most likely be on the same deal as was proposed before the holidays.

The anti-Google contingent continues to be upset with Leibowitz, saying the decision comes back to him losing leverage because he let it be known he wants to leave public office himself soon.

“People at all levels of the agency, senior staff and management, believe that FTC has every reason to wait and see what’s offered up in Europe,” said a person familiar with the negotiations.

“The chairman and the chairman alone controls timing, and he seems to be determined to cram this down their throats. There’s an opportunity for consensus but nobody can convince him to push the pause button.”

But another way to view the case is that the FTC had a “weak hand” all along, as one legal expert put it, especially compared to competition laws in the European Union. Because Google doesn’t charge consumers for search, and there are alternatives, it would be hard for the FTC to prove that Google’s search practices actually hurt consumers.

Meanwhile, Microsoft, one of the biggest critics of Google, continues to complain about ways it feels it’s getting shafted by the search giant. Today, one of the company’s senior lawyers charged that Google executives have blocked the company’s YouTube unit from providing the support necessary to build a full-featured YouTube app for Windows Phone.

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— Gitesh Pandya of comments on the dreadful opening weekend box office numbers for “The Fifth Estate.”