Google Faces EU Investigation

Google quickly took the offensive to address reports of an investigation into its practices by the European Union. In a blog post late Tuesday by Julia Holtz, senior competition counsel at Google (NASDAQ: GOOG), the search giant acknowledged it’s been notified by the European Commission that three firms – a UK price comparison site called Foundem, a French legal search engine called and Microsoft’s
Ciao! from Bing – have filed complaints about its practices.

In the blog posting entitled “Committed to competing fairly,” Holtz said Google
wanted to present its side given the kind of media attention complaints of this kind tend to generate. Microsoft (NASDAQ: MSFT) and Intel (NASDAQ: INTC) have both faced costly, high profile, drawn-out EC antitrust investigations and the EC also held up Oracle’s purchase of Sun for months while it investigated antitrust concerns.

The complaints, according to Google’s post, claim that the sites are not being ranked fairly by Google which hurts how high they appear in Google’s results.

“Foundem — a member of an organization called ICOMP, which is funded
partly by Microsoft — argues that our algorithms demote their site in
our results because they are a vertical search engine and so a direct
competitor to Google.’s complaint seems to echo these
concerns,” Holtz added.

“Regarding Ciao!, they were a long-time AdSense partner of Google’s, with whom we always had a good relationship. However, after Microsoft acquired Ciao! in 2008 (renaming it Ciao! from Bing) we started receiving complaints about our standard terms and conditions. They initially took their case to the German competition authority, but it
now has been transferred to Brussels,” Holtz added.

“Though each case raises slightly different issues, the question they ultimately pose is whether Google is doing anything to choke off competition or hurt our users and partners. This is not the case,” she wrote. The blog also said Google would provide a more detailed defense in the weeks ahead.

“We are also the first to admit that our search is not perfect, but it’s a very hard computer science problem to crack. Imagine having to rank the 272 million possible results for a popular query like the iPod on a 14 by 12 screen computer screen in just a few milliseconds. It’s a challenge we face millions of times each day,” the blog stated.

That said, Holtz argued that Google does the best and most objective
job it based on its search algorithms.

David Needle is the West Coast bureau chief at, the news
service of, the
network for technology professionals.

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