Can Google Wriggle Out of This Double Trouble?
Continuing with its attempts to persuade regulators that the company did not break any antitrust laws, Google (NASDAQ:GOOG) chief executive Larry Page has met with U.S. Federal Trade Commission officials in Washington, D.C. The agency is close to completing its 19-month investigation of the company’s business practices, and according to Bloomberg, Google is hoping that any agreement it makes with the FTC won’t be bound by a consent decree.
What is the FTC Investigation About?
Google has been under investigation for allegedly changing the results on its popular search website so that they favor its own services. Other important issues include Google’s exclusive agreements to provide search services to online publishers, alleged misuse of patents to block rival smartphones from entering the market, and allegations that it used customer reviews from other websites without permission.
Catalysts are critical to discovering winning stocks. Check out our newest CHEAT SHEET stock picks now.
The FTC is said to be incredibly concerned about Google’s dominance of Internet search, and the agency’s chairman, Jon Leibowitz, has told the company that it should either be ready to face a lawsuit or accept a resolution that includes a consent decree.
What Can Google Do About It?
Google is concerned that entering a formal settlement agreement may hurt business and the company has reportedly been in settlement talks with the FTC for about a week. In addition to Page, Google chairman Eric Schmidt is reportedly also involved in talks, and according to Bloomberg, was spotted on Capitol Hill with the head of the company’s Washington office, the former New York Republican Congresswoman Susan Molinari.
“We continue to work cooperatively with the Federal Trade Commission and are happy to answer any questions they may have,” Google spokesman Adam Kovacevich told Bloomberg.
How Can This Impact the Company’s Stock?
Getting sued by the government agency will not be in Google’s interests, so a settlement remains the best option. However, considering the scale of the allegations, the FTC is not expected to allow the company to be let off easy. In addition, Google is also in discussions with European Union officials to resolve similar antitrust concerns in that continent. It has been blamed for ranking its services higher, copying content, and making advertising agreements that kill competition — all serious offenses. Not a positive chain of circumstances at all.