FTC Staff Wanted to Sue Google for Ripping Off TripAdvisor and Yelp

The Federal Trade Commission’s bureau of competition staff advised the commission to sue Google and agreed with TripAdvisor’s and Yelp’s charges in 2011 that Google was illegally ripping off their user reviews, but the FTC decided not to challenge Google in court.

The FTC staff likewise agreed in 2013 with TripAdvisor’s and Yelp’s assertions to Congress that Google had threatened to remove the two companies from the Google search engine if they didn’t agree to let Google display their reviews in Google Places.

The behind-the-scenes wrangling in the FTC’s 2012 and 2013 antitrust probe of Google’s practices came to light because the Wall Street Journal inadvertently obtained the staff’s 160-page report as part of a wider Freedom of Information request, and described the dynamics of the probe in an article published March 19. The FTC ultimately dropped the probe after Google made some modest changes.

Yelp, for one, still isn’t happy with Google’s practices.

In a presentation at an investors conference in New York on March 11, Yelp CFO Rob Krolik discussed the alleged roadblocks that Google presents to Yelp’s users.

“Consumers are fighting through their [Google’s] content to get to ours,” Krolik said, referring to the Google Local Carousel and other Google products that often get preferential display space over organic results.

In addition to the transgressions against TripAdvisor and Yelp, the FTC staff found that Google copied Amazon’s reviews and sales rankings without authorization.

The article states that three FTC commissioners expressed “strong concerns” about Google’s actions but ultimately decided not to sue.

Vertically Challenged

The Wall Street Journal article noted that it was unusual for the FTC to ignore the competition staff’s recommendations to sue but pointed out that the FTC’s economics staff opposed filing a lawsuit, and the Obama administration has a close relationship with Google executives.

The FTC’s bureau of competition staff also found that Google was favoring its own travel, local, and finance products over competitors’ offerings and these actions harmed competitors in many verticals. But the staff largely agreed with Google’s contentions that it was trying to improve the consumer search experience so it didn’t want to sue over this issue.

The European Commission has been tougher on Google than the FTC has and a European probe is ongoing.

Source: The Wall Street Journal