According to widespread media reports the US Department of Justice is readying to investigate into Google. It has been reported that the probe would examine whether the tech giant broke antitrust law in the operation of its online and advertisement businesses.
On Monday news reported by Yahoo Finance suggests that the Justice Department’s Antitrust Division and the Federal Trade Commission (FTC) met in recent weeks. They both have agreed to give the Justice Department the jurisdiction to undertake potential antitrust probes of major tech giants like Facebook, Amazon, Apple and Google.
The supposedly imminent US investigation is the latest sign of the increasing scrutiny facing the world’s major tech businesses. Other reports cited that the e-commerce giant Amazon could also face the heightened antitrust scrutiny under a new agreement between U.S. regulators and the FTC.
Nancy Pelosi, Speaker of the House, tweeted yesterday that, “the US regulators will begin long overdue investigation to determine if digital platforms have harmed Americans. Unwarranted, concentrated economic power in the hands of a few is dangerous to democracy – especially when digital platforms control content. The era of self-regulation is over.”
Unwarranted, concentrated economic power in the hands of a few is dangerous to democracy – especially when digital platforms control content. The era of self-regulation is over.
— Nancy Pelosi (@SpeakerPelosi) June 4, 2019
The news of the potential investigation for Google and Facebook was first broken by The Wall Street Journal last Friday. As per a CNN report the scope of DOJ’s interest is unclear. Agency regulators led by antitrust chief Makan Delrahim say their focus is on Google’s search business and Google’s advertising practices.
This investigation would pose the most serious challenge to the tech industry, as political leaders like Elizabeth Warren have accused Silicon Valley titans of strangling competition and have also demanded the tech giants to be broken up. These calls have been spurred on by an endless string of privacy mishaps, misinformation scandals and the proliferation of graphic and hateful content on the tech platforms. Most recent example being of the Christchurch terrorist attack in New Zealand which was enabled and amplified by social media.
This fresh investigation of Google by US regulators could also reopen older probes from 2013 when the company was under FTC investigation. But it emerged relatively unscathed as Google pledged to change certain aspects of its business, such as how it handles content from third-party travel or shopping sites etc. The FTC then closed the investigation.
EU regulators have also taken Google under similar scrutiny when this year in March, the company faced a €1.5bn fine from EU regulators over antitrust violations.
The fine was linked to its AdSense service, with the EU ruling that the terms it forced on companies were unfair. They included preventing rivals from appearing in online search ads from “exclusivity contracts” with publishers.
The €1.5bn fine was the third that the EU commission had made against Google in the past two years.
In 2018, it slapped the firm with a €4.3bn fine relating to its Android mobile operating system that was used to unfairly undercut rivals in the mobile phone market and a €2.4bn fine for promoting its own shopping service over rivals.
CNN further reports that according to few analysts the likelihood of a new probe for Google is high. “If there were a clearance fight over a Google investigation — this is such a big matter that whoever won the clearance fight would almost certainly be opening an investigation,” said Michael Kades, a former FTC antitrust attorney.
“Still, just because DOJ is taking on responsibility for Google’s oversight does not mean an investigation has been opened or that the agency is imminently poised to act against Google,” said Gene Kimmelman, a former Justice Department antitrust official.
“This is a warning sign for Google,” he said. “It’s quite clear the Department of Justice will be at least scrutinizing their behavior very carefully.”
Maureen Ohlhausen, a former acting chairman of the FTC, said the tech industry’s fall from political grace has raised expectations for the nation’s top competition enforcers — and for Delrahim to stake out new territory for DOJ.”
“With the continuing techlash from the right and the left, both antitrust agencies are under pressure to escalate their actions,” she said.
“The companies ought to be careful about how they behave at this moment,” Kimmelman added. “But I also think there will be enormous scrutiny of what the enforcement officials do, and why they do it.”