FTC staff report details how Google favored its own shopping, travel services over rivals

How Google Skewed Search Results

FTC staff report details how Google favored its own shopping, travel services over rivals

By Rolfe Winkler And Brody Mullins
Updated March 19, 2015 7:25 p.m. ET

A previously undisclosed report by staffers at the Federal Trade Commission reveals new details about how Google Inc. manipulated search results to favor its own services over rivals’, even when they weren’t most relevant for users.

In a lengthy investigation, staffers in the FTC’s bureau of competition found evidence that Google boosted its own services for shopping, travel and local businesses by altering its ranking criteria and “scraping” content from other sites. It also deliberately demoted rivals.

For example, the FTC staff noted that Google presented results from its flight-search tool ahead of other travel sites, even though Google offered fewer flight options. Google’s shopping results were ranked above rival comparison-shopping engines, even though users didn’t click on them at the same rate, the staff found. Many of the ways Google boosted its own results have not been previously disclosed.

The report’s insight into Google’s business practices is still relevant as Google expands its own offerings. Just this month, it launched a search tool for car-insurance quotes, which competes with similar tools offered by Allstate Corp.’s Esurance, among others. It has beefed up hotel listings that compete with TripAdvisor Inc. and Expedia Inc.

The staff report lends credence to longstanding complaints by Google rivals that the search giant was unfairly discriminating against them. Local-listings site Yelp Inc., for example, complained publicly during the FTC’s investigation that Google copied its reviews to give its own local listings more heft.

The report’s findings are at odds with Google’s descriptions of its search practices. Then-Chief Executive Eric Schmidt, now executive chairman, told a Senate panel in 2011 that “he was not aware of any strange boosts or biases” in Google’s results. “I can assure you we’ve not cooked” the results, Mr. Schmidt added.

“After an exhaustive 19-month review, covering nine million pages of documents and many hours of testimony, the FTC staff and all five FTC Commissioners agreed that there was no need to take action on how we rank and display search results,” Google General Counsel Kent Walker said in a statement on Thursday.

“We regularly change our search algorithms and make over 500 changes a year to help our users get the information they want,” Mr. Walker added. “We created search for users, not websites—and that focus has driven our improvements over the last decade.”

Google has said that promoting its own specialized-search services gets more information to users more quickly. That’s more important in the smartphone age when clicking back and forth from a search page can be frustrating.

The FTC staff found that Google promoted its own services in part because it feared losing searches, and advertising revenue, to rivals such as Yelp and TripAdvisor.

One way Google favored its own results was to change its ranking criteria. Google typically ranks sites based on measures like the number of links that point to a site, or how often users click on the site in search results.

But Marissa Mayer, who was then a Google vice president, said Google didn’t use click-through rates to determine the ranking for its own specialized-search sites, because they would rank too low, according to the staff report. Ms. Mayer is now chief executive of Yahoo Inc. A Yahoo spokeswoman didn’t immediately make her available for comment.

Instead, Google would “automatically boost” its own sites for certain specialized searches that otherwise would favor rivals, the FTC found. If a comparison-shopping site was supposed to rank highly, Google Product Search was placed above it. When Yelp was deemed relevant to a user’s search query, Google Local would pop up on top of the results page, the staff wrote.

Other regulators have found similar practices. European antitrust authorities in 2013 said Google had a different, “specialized” search algorithm for ranking its own content.

To bolster its own listings, Google sometimes copied, or “scraped,” information from rival sites. According to the FTC report, Google copied Amazon’s rankings of how well products were selling, then used that information to rank its results for product searches. Amazon declined to comment.

While Google promoted its own results, it sometimes demoted rivals, the FTC staff found. For example, Google compiled a list of comparison-shopping sites and “demoted them from the top 10 web results,” staff wrote. According to the report, Google users in tests didn’t like the changes; only after Google tweaked its search algorithm at least four times, and changed the ranking criteria, did the new results get “slightly positive” feedback, the staff said.

Google’s efforts paid off, the FTC found. It said Google’s maneuvers reduced Web traffic to rivals, and increased traffic to Google sites.

Write to Rolfe Winkler at rolfe.winkler@wsj.com and Brody Mullins at brody.mullins@wsj.com


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