Internal memos from the Federal Trade Commission over its refusal to sue Google for anticompetitive practices show that federal regulators not only ignored the anticompetitive power and practices Big Tech could amass, but also willingly let the company off the hook, Politico reports.
In 2013, federal antitrust regulators appointed by then-President Barack Obama chose to settle a years-long investigation into Google’s anticompetitive practices with a “handshake agreement” instead of suing the Big Tech giant over its attempts to block out rival companies and products using patents and its domination of search engine and advertising markets.
“Google averted what could have been a much harsher penalty from the Federal Trade Commission: antitrust charges that it illegally wielded monopoly power in online search to thwart rivals, the sort of resolution that had been advanced vigorously by its opponents,” Politico wrote in 2013, noting later that the FTC “has never disclosed the full scope of its probe nor explained all its reasons for letting Google’s behavior slide.”
More than 300 pages of memos, however, show that FTC regulators bypassed advice to sue Google for anticompetitive behavior and used incorrect assessments to justify the tech giant’s actions. Denying that Google manipulated its technology such as search engines and advertising to damage its competition, the agency instead concluded that the company merely wanted to “improve search results for consumers.”
While antitrust lawyers warned that Google’s power, especially in the “U.S. mobile search market,” which later became the subject of a federal antitrust lawsuit under the Trump administration, could potentially grow beyond what the FTC could check, commissioners ignored their advice and chose to listen to economists who promised that regulation and federal interference was not the answer, granting Google years of padding and excuses for its behavior.
Not only did the FTC completely underestimate the future of digital advertising, writing off targeted products and cookies as a technology that “do[es] not account for a significant portion of online advertising and, today, with the exception of social media advertising, appear to have only limited potential for growth,” but the agency’s economists and attorneys also split over how much market share the Big Tech company possessed. While the FTC lawyers warned that Google showed signs of dominating market share early on, the agency’s economists stated that the Silicon Valley giant had “only limited impact” on market share, statistics Google acknowledged were probably an underestimation.
The agency also relied on assessments from financial experts who claimed that while Google clearly held a large portion of the mobile phone industry’s market, competitors such as Microsoft, Yahoo, and Amazon still had opportunities to create, feature, and sell their products without hindrance, an analysis disputed by Google and Apple’s 99.8 percent grip on the U.S. smartphone market. These same experts also claimed that mobile search “represents a relatively small percentage of overall queries and an even smaller percentage of search ad revenues,” another inaccurate read on the future of digital advertising.
Despite internal discussions between colleagues in the FTC and pleas from Google’s rivals to take action, the agency ultimately said that while there was only “some evidence” that Google was intentionally acting anticompetitive, it “did not believe that the evidence supported an FTC challenge to this aspect of Google’s business under American law.”
Google, of course, still seems to have no problem with the FTC’s original decision, ignoring the company’s close ties to the Obama administration and severe downplaying of the future of internet technology to reiterate Big Tech talking points.
“This is old news. A bipartisan FTC voted unanimously to close its investigation into Google nearly a decade ago — supported by recommendations by all of the FTC divisions including the Bureau of Competition, the Bureau of Economics, and the Office of General Counsel,” a Google spokesman told Politico. “In closing its investigation, the FTC stated that our changes to Google Search were procompetitive and benefited consumers. And in the eight years since, competition in search has only increased as people have more ways than ever to access information online, including through an array of dedicated mobile apps.”
Despite Google’s insistence that it is justified by the controversial investigation, the Silicon Valley giant has clearly used its power to manipulate the markets and control narratives. Not only is the company often the target of antitrust lawsuits, congressional hearings, and has even received reprimands from the U.S. Supreme Court, but Google also has a track record of censoring and de-platforming conservatives and lying about how it is using data and information.