Google Said to Face Ultimatum From FTC in Antitrust Talks
Google Inc. (GOOG) is being pressed by U.S. Federal Trade Commission Chairman Jonathan Leibowitz to make an offer to settle the agency's antitrust investigation in the next few days or face a formal complaint, two people familiar with the situation said.
Context & Ripple Effects
The ultimatum caps an 18-month escalation: the FTC served Google with broad antitrust subpoenas in June 2011, hired outside counsel soon after, and by October 2012 sources said the agency was moving closer to filing, with a reported majority of commissioners favoring a case. Chairman Jonathan Leibowitz's demand for a settlement offer within days converts that drift into a deadline.
The story traveled widely — pickups at CNET, TechCrunch, ZDNet, Search Engine Land and others on the same day — reflecting how consequential the choice looks: per the same sourcing, vertical search may not even be the central issue in any complaint, which widens the range of conduct a settlement would have to cover.
First-order effects
- Google must decide within days whether to table concessions to Leibowitz or face a formal complaint that commits the company to years of litigation and discovery over its search and advertising practices.
- A filed complaint would put the FTC's internal deliberations on the record, forcing the rumored commissioner majority into a public vote and giving Google's critics a documented theory of harm.
Second-order effects
- Any US settlement terms become the reference point for the European Commission, which was already weighing whether to open proceedings against Google as of September 2012 — Brussels can anchor its demands to whatever Washington extracts.
- Vertical-search rivals and advertisers gain leverage either way: a settlement codifies conduct rules they can enforce, while a complaint hands them discovery ammunition in private suits.
Third-order effects
- If the pattern holds, major platforms should expect coordinated multi-jurisdiction antitrust pressure rather than single-agency scrutiny, with settlement deadlines used as the standard forcing mechanism before complaints are drafted.
- The case also tests how far the FTC will push beyond its 2002 paid-placement disclosure guidelines toward substantive conduct remedies for search ranking — a precedent that would define regulator-platform relations for the next decade of web intermediaries.
The trend: Antitrust enforcers in Washington and Brussels are converging on search-platform conduct simultaneously, using settlement ultimatums to extract binding conduct commitments without litigation.