Microsoft’s Old Nemesis, Gary Reback, to Address Antitrust Probe of Google

Tue, Nov 30, 2010 at 5:46 pm

    Will U.S. antitrust regulators follow Europe’s lead and do what the European Commission did today — launch an in-depth probe to determine if Google is using illegal monopolistic business practices?

    That question is reverberating around the global community of antitrust experts who were around the last time the U.S. and Europe engaged a giant tech monopoly at the peak of its powers in a landmark antitrust case.

    We’re referring, of course, to the U.S. Department of Justice vs. Microsoft and the European Commission vs. Microsoft.

    On Wednesday morning, a pivotal figure from the U.S. vs. Microsoft case — bulldog litigator Gary Reback — is expected to give his view on whether Google is treading down the path Microsoft took in the mid- to late-1990s. The software giant ultimately endured major sanctions from antitrust regulators on both sides of the Atlantic.

    Reback will speak at a day-long conference in Washington D.C. titled The Future of Online Consumer Protections, sponsored by the non-profit Consumer Watchdog advocacy group. You can partake of a live Web cast of this conference at this link. The agenda starts at 8 a.m. Eastern. You can view a list of speakers here.

    Reback spearheaded the push that resulted in U.S. District Court Judge Thomas Penfield Jackson’s June 2000 order requiring Microsoft to be broken up into two companies. Jackson issued that sanction based on an earlier finding that Microsoft held monopoly power and used it to harm consumers, rivals and other companies. Microsoft successfully appealed Jackson’s breakup order, but accepted other penalties.

    Last April, Consumer Watchdog published this report, titled Traffic Report: How Google Is Squeezing Out Competitors and Muscling Into New Markets. The group formally asked the Justice Department to launch an antitrust probe of the search giant. But the European Commission beat their U.S. counterparts to the punch.

    “I welcome the European action, but Google is a U.S. Company and it’s long past time for our authorities to launch an investigation,” says Consumer Watchdog spokesman John Simpson.

    Scott Cleland, principal analyst at Precursor Group, says Google clearly owns a monopoly in search advertising, and thus must abide laws restricting it from engaging in specific anticompetitive practices.

    Cleland anticipates that Europe’s regulators with look into allegations that Google discriminates against competitors in unpaid and paid search results, favors Google’s products and services in search results and imposes obligations on its advertising partners. “The EU apparently has deep and wide concerns about multiple patterns of alleged anti-competitive behavior,” says Cleland.

    Google insists it has done nothing illegal.

    “Given our success and the disruptive nature of our business, it’s entirely understandable that we’ve caused unease among other companies and caught the attention of regulators,” writes Susan Wojcicki, Google senior vice president of product management, in this blog post. “Today, the European Commission has announced that they will continue to review complaints about Google’s search and search advertising. We respect their process and will continue to work closely with the Commission to answer their questions.”

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