Excerpt from voices.washingtonpost.com/posttech

Cecilia Kang
Wednesday, December 1, 2010

E.U. launches antitrust probe of Google

The European Commission, the European Union's executive body, said Tuesday that it has opened a formal antitrust investigation into Google's practices, focusing on whether the search giant illegally used its dominance to lower the rankings of unpaid results from competitors while giving preferential rankings to its own services.

"This initiation of proceedings does not imply that the Commission has proof of any infringements," the commission said in a statement. "It only signifies that the Commission will conduct an in-depth investigation of the case as a matter of priority."

The European probe comes amid greater scrutiny of Google's business. The search firm's proposed merger with online travel software provider ITA is under review by U.S. regulators and has been opposed by firms such as Expedia, Travelocity and TripAdvisor, which are lobbying the Justice Department against the deal.

The review stems from complaints filed with the commission by three European Web firms - Foundem, a British shopping comparison site; Ciao, an Internet retailer in Germany run by Google competitor Microsoft; and the legal search firm Ejustice.fr of France. In its review, the commission will examine the following issues:

l Rankings. The companies say Google lowered the rankings of their sites and others in unpaid search results and gave preferential placement to its own services in order to shut out competitors.

l Sponsored advertising. Google also allegedly lowered the "Quality Score" for sponsored links from competing search services. The Quality Score is one factor that helps determine the cost of advertising on Google; the lower the score, the higher the price per ad.

l Advertising obligations. Google is also accused of forcing companies to accept exclusive advertising agreements, preventing them from placing ads on competing Web sites.

l Data portability. Finally, Google allegedly blocked companies from transferring advertising data to competing online ad platforms.

Google said Tuesday that it will work with the commission on the investigation. In an entry on the company's blog, Google executives stressed that the search service is designed with users in mind, meaning that some Web firms may be dissatisfied with the results.

"Not every website can come out on top, or even appear on the first page of our results, so there will almost always be website owners who are unhappy about their rankings," wrote Susan Wojcicki, senior vice president of product management, and Udi Manber, vice president of engineering.

© 2010 The Washington Post Company