Google Proposes Remedies To EU Antitrust Woes

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Google executive chairman Eric Schmidt has submitted a proposal to Joaquin Almunia, VP of the European Commission responsible for competition policy, to resolve European antitrust concerns.

Google declined to make its proposal public, but offered a statement. “We have made a proposal to address the four areas the European Commission described as potential concerns,” a company spokeswoman said in an email. “We continue to work cooperatively with the Commission.”

The European Commission began its inquiry into how Google runs its search business in November 2010, following complaints from various online companies. In May, Almunia outlined four areas of concern and told Google that it had several weeks to respond. Failure to do so would have invited more formal antitrust action.

Google’s proposal is likely to address how it treats third-party search site links, the extent to which it presents third-party content in its search results, potential revisions to its AdSense terms of service that accommodate competing ad networks in Google partner sites, and AdWords API rules that limit automated ad campaign data export.

[ Google’s technology vision is more ambitious and socially transformative than its competitors’–but it’s also riskier. Read Google’s Risky Business. ]

Google also faces antitrust scrutiny in the United States, at both the federal and state levels. In April, the Federal Trade Commission hired an experienced antitrust litigator to direct its investigation into Google’s search business. California, New York, and Texas are meanwhile conducting their own inquiries into Google’s search advertising business.

In addition, regulatory bodies in Argentina, India, and South Korea are pursuing their own search-related inquiries.

Revisiting a legal argument it made in a case nine years ago, Google is testing the waters for a free-speech defense against antitrust claims. The company recently commissioned UCLA law professor Eugene Volokh to argue that Google has a “First Amendment right to decide how to present information in its speech to its users.”

Columbia law professor Tim Wu last month argued against that position, claiming that “[giving] computers the rights intended for humans is to elevate our machines above ourselves.”

Critics of Wu’s position have dismissed his argument by noting that computers are just tools that carry out human instructions, like the printing press, and that First Amendment protection remains with people, regardless of their chosen medium of expression.

Steve Pociask, president of the American Consumer Institute, a free-market advocacy group, expressed skepticism of Google’s proposal in an emailed statement. “Unfortunately, Google has a long track record of settling issues or apologizing to various agencies and promising to change [its] behavior only to abuse [its] dominant power and behave badly soon after, flouting [its] previous pledge to do better,” he said. “Given [the company’s] history, it would be wise to be skeptical of any settlement that Google reaches without serious limits and real incentives to change [its] behavior.”

Thomas Vinje, European Union counsel to FairSearch, a coalition backed by Microsoft and several online travel companies, said he looked forward to providing input to the European Commission about ways to restore competition in the search market. “We hope the proposals reflect a greater willingness to end Google’s anti-competitive behavior than has its consistent rejection of the concerns that Mr. Almunia identified after collecting evidence for nearly two years,” he said in a statement.

At this year’s InformationWeek 500 Conference, C-level execs will gather to discuss how they’re rewriting the old IT rulebook and accelerating business execution. At the St. Regis Monarch Beach, Dana Point, Calif., Sept. 9-11.

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