FTC Begins Google Anti-Trust Investigation

Here’s the story from the NY Times:

The Federal Trade Commission has opened a preliminary antitrust investigation into Google’s planned $3.1 billion purchase of the online advertising company DoubleClick, an industry executive briefed on the agency’s plans said yesterday.

The inquiry began at the end of last week, after it was decided that the Federal Trade Commission instead of the Justice Department would conduct the review, said the executive, who asked not to be identified because he had not been authorized to speak. The two agencies split the duties of antitrust enforcement.

An F.T.C. spokesman said yesterday that the agency did not comment on pending inquiries.

The EU also has an investigation going against Google (and MSFT, Yahoo). Google has faced lots of legal issues and litigation since it went public. The anti-trust “complaints” by big corporate competitors ring somewhat hollow and, I believe, are part of a shrewd PR campaign against the search market share leader.

But this is where Google is vulnerable. I don’t think the FTC will block the DoubleClick acquisition ultimately. I think the real danger for Google now lies in its footprint and market power. Consumers show no signs of abandoning Google, as it continues to gain search share.

If Google becomes seen as too powerful or in control of too much consumer data and thus a privacy risk it may erode the public’s confidence in Google. This is what I meant when I said that as Google appears to be more powerful than ever it is increasingly vulnerable.

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Related: Microsoft’s Don Dodge posts on the relationship between search market share and market capitalization. He also analyzes Google’s revenues.


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