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Regulators reportedly weigh investigation of Google

Search-industry domination cited

Google

The possibility of an investigation is sparked by Google's dominance in the Internet-search industry.

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WASHINGTON -- The Federal Trade Commission is considering a broad anti-trust investigation into Google Inc.'s dominance of the Internet-search industry, two people familiar with the matter said.

Before proceeding with any probe, the FTC is awaiting a decision by the Justice Department on whether it will challenge Google's planned acquisition of ITA Software Inc. as a threat to competition in the travel-information search business, said the sources. They spoke on condition of anonymity because the matter is still confidential.

An FTC investigation of Google, the world's most popular search engine, "could be on par" with the scope of the Justice Department's probe of Microsoft Corp. a decade ago, said Keith Hylton, a professor of antitrust law at Boston University school of law. Google "could fight the FTC, but that's going to cost a lot of money and time."

The FTC and Justice Department share responsibility for oversight of anti-trust enforcement, and the outcome of the ITA deal may determine whether the agencies will vie for control of a broader probe of Google, the people said.

The two agencies sometimes negotiate which will handle major anti-trust investigations, with the decision turning on their respective expertise.

The Justice Department may soon announce its decision on Google's purchase of ITA, said the people familiar with the matter.

FTC Commissioner Thomas Rosch said in an interview last month he supported a probe of the dominant players in the Internet-search industry, without specifying which companies. He is one of two Republicans on the five-member commission. He is the only commissioner to say publicly that such an investigation is in order.

If consumers do not like what the company is doing, they can switch to another search engine, said Adam Kovacevich, a Google spokesman.

"Since competition is one click away on the Internet, we work hard to put our users' interests first and give them the best, most relevant answers to their queries," he said. "We built Google for users, not Web sites."

Cecelia Prewett, a spokesman at the FTC, and Gina Talamona, a Justice Department spokesman, declined to comment.

Google is facing growing scrutiny from regulators as it bolsters its search business. Officials in Texas and the European Commission have started investigations into Google's search dominance. Ohio Attorney General Mike DeWine is considering such a probe.

The EU probe is examining whether Google discriminated against other services in search results and stopped Web sites from accepting rival ads. A complaint from Microsoft last month may expand the investigation to online video and mobile phones.

The state of Wisconsin is weighing an examination of Google's bid to buy ITA. The company, based in Cambridge, Mass., provides data for airline ticket fares to online travel sites, according to a person familiar with the matter.

Lawmakers including Sen. Mike Lee, a Utah Republican, and Sen. Richard Blumenthal, a Connecticut Democrat, have urged the Senate Judiciary subcommittee on anti-trust to hold a hearing on Google's dominance of Internet businesses. Herb Kohl, the Wisconsin Democrat who heads the panel, has said he is examining Google.

"An investigation is long overdue," said Gary Reback, an anti-trust lawyer in Menlo Park, Calif.

He represents companies that have complained about Google to U.S. and European regulators. "Every day there are companies who are being hurt by Google's anti-competitive behavior, and we still have arm-wrestling going on in Washington," Mr. Reback said in an interview Tuesday.

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