Google faces a new antitrust probe by 50 attorneys general
Google faces a new antitrust probe
by 50 attorneys general
KEY
POINTS
- Texas will lead a joint state
investigation into Google over antitrust concerns, state Attorney General
Ken Paxton announces Monday.
- The news follows the announcement
of a joint state Facebook probe led by the attorney general of New York.
- Google is also reportedly facing an
antitrust probe from the U.S. Department of Justice.
The news
confirms reports last week
about the bipartisan investigation into Google’s practices. The probe includes
attorneys general from 48 states, the District of Columbia and Puerto Rico.
California and Alabama are not involved in the probe, Paxton said at a press
conference.
Other
attorneys general at the media conference emphasized Google’s dominance in the
ad market and use of consumer data.
“When there
is no longer a free market or competition, this increases prices, even when
something is marketed as free, and harms consumers,” said Florida Attorney
General Ashley Moody, a Republican. “Is something really free if we are
increasingly giving over our privacy information? Is something really free if
online ad prices go up based on one company’s control?”
An
antitrust probe into Facebook was
announced on Friday by New York Attorney General Letitia
James, who will lead the case. Attorneys general from seven states
plus the District of Columbia are participating in the Facebook investigation.
At the
press conference Monday, D.C. Attorney General Karl Racine, a Democrat, said it
“remains to be seen” if the two probes will be “a coordinated expansion.”
Shares of Google parent company
Alphabet were down about 0.9% around the time of the announcement. When reached
for comment, a Google spokesperson pointed to a company blog post published
Friday where it acknowledged it had received requests for information from the
Department of Justice about its business practices and expects “state attorneys
general will ask similar questions.”
“We have
always worked constructively with regulators and we will continue to do so,”
Google said in Friday’s post.
The state
investigations put an additional layer of pressure on both companies, which are
already facing antitrust scrutiny on the federal level. Facebook confirmed an
antitrust probe by the Federal Trade Commission in July after the agency
slapped it with a $5 billion fine over
its privacy practices. And the Department of Justice will conduct its own
antitrust investigation into Google, according to The Wall Street Journal.
The
attorneys general involved in the Google probe said their investigation would
remain independent from those of other areas of government.
“The state
attorneys general, they are an independent bunch,” Racine said. “And they can
be quite tenacious. So I’m very confident that this bipartisan group is going
to be led by the facts and not be swayed by any conclusion that may fall short,
if you will, if it’s inconsistent with our facts, on the federal side. So we’re
going to do what we think is right based on our investigation.”
So far,
regulatory action on the federal level has had a minimal impact on
Big Tech. The FTC recently imposed fines on both
Google and Facebook — over their handling of user data — that would be
considered large by most standards but represented just a small fraction of
their quarterly revenues.
But
antitrust, compared with privacy and consumer protection concerns, poses a more
direct threat to these companies’ business models. If the federal or state
probes find evidence of anti-competitive behavior at Google, for example, the
company could be compelled to make its algorithms friendlier to rivals even if
that eats at its own profits. It could also be forced to spin off entire
business units, such as YouTube.
Doug
Peterson, Nebraska’s Republican attorney general, said he looks forward to
working with the U.S. Justice Department as well as international authorities.
“It really
is significant the fact that you’ve got the U.K., France, Australia, the
European Commission looking at this, all indicate that this is a significant
issue,” Peterson said.
The focus
on Google and Facebook by the state attorneys general does not mean other tech
giants such as Amazon and Apple will be free from scrutiny. Sources
told the Journal last week
that the investigations could expand to other companies.
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