News

Google Blocking Search Competitors in Europe, Microsoft Claims

• By Kurt Mackie
• 03/31/2011

Microsoft on Wednesday announced that it had filed a complaint with European Commission (EC), adding to the EC's antitrust investigation into whether Google has been inhibiting search-advertising competition in European markets.

Brad Smith, a senior vice president and general counsel at Microsoft Corp., outlined five main concerns in a blog post. He claimed that Google holds "about 95 percent" of the European search market, according to the EC's own statistics.

Smith noted that Microsoft was filing its complaint to "be transparent and provide some information on what we're doing and why." However, the original complaint appears to have originated months earlier from a Microsoft affiliate.

In a February 2010 blog post, Julia Holtz, Google's senior competition counsel, disclosed that three companies -- Foundem, ejustice.fr and Microsoft's Ciao! from Bing -- had filed the initial complaints before the EC. She said that Foundem had links to Microsoft through its affiliation with an Internet e-commerce organization called ICOMP, which is partly funded by Microsoft.

A spokesperson for Google today reiterated that point, in a released statement.

"We're not surprised that Microsoft has done this, since one of their subsidiaries was one of the original complainants," the statement explains. "For our part, we continue to discuss the case with the European Commission and we're happy to explain to anyone how our business works."

Smith complained that Google has been restricting competing search engines from accessing information needed to find YouTube videos (Google owns the YouTube network). Access to metadata needed to find YouTube videos is allowed by Google for Android phones and Apple iPhones, but "Google has refused to provide" that data for Windows Phones, Smith contended.

Smith also takes issue with Google's plan, which was rejected by a federal court, to enable its search engine "exclusive and unfettered access" to online books where the copyright is missing. He also echoed some complaints already before the EC, including the claim that Google "contractually prohibits advertisers from using their data in an interoperable way with other search platforms."

The EC publicly announced its investigation of Google in November of last year. At that time, the EC indicated that it was investigating Google for "allegedly lowering the ranking of unpaid search results of competing services." It was also seeing if Google had "lowered the 'Quality Score' for sponsored links of competing vertical search services." The EC was also investigating if Google was imposing "exclusivity obligations on advertising partners" that disallowed them from including competing ads on their Web sites or porting Google ad data to competing ad platforms.

Smith said that some would note "the irony" of Microsoft's filing before the EC, since the company has battled the EC for years. The EC eventually found that Microsoft had used its Windows monopoly to stifle Web browser competition in Europe, for instance. At that time, Neelie Kroes, the EC's commissioner for competition, had cast Microsoft in the role of a scofflaw.

However, that assessment in Europe may be changing. A Microsoft blog recently cited approval by Kroes -- apparently in the form of an "EU" lipstick smear -- for Microsoft's opening of its first Cloud and Interoperability Center in Brussels, Belgium.