Turnabout is fair play when it comes to antitrust cases.
For years, companies have used antitrust complaints against Microsoft to hobble the software giant. Now Microsoft is using the same tactic against its biggest current rival, Internet search king Google.
The European Commission has opened a preliminary investigation into Google’s dominance in search and search advertising after getting complaints from three European companies — two affiliated with Microsoft. They are Ciao from Bing, a subsidiary of Microsoft, and Foundem, a member of an organization called ICOMP that is partly funded by Microsoft. Also filing a complaint against Google was French legal search engine Ejustice.fr.
The inquiry was disclosed late Tuesday. Google has denied any wrongdoing.
Some companies use antitrust cases, especially in Europe, to gain a competitive edge with rivals that dominate a sector, says Nicholas Economides, professor of economics at New York University’s Leonard N. Stern School of Business.
“It has been extremely effective against Microsoft,” Economides said in an interview. “Antitrust enforcement generally is stricter in Europe. Therefore if a company has an antitrust-related complaint and it’s a global company, it makes lots of sense to bring it to the European Union because it has a better chance of success.”
The EU has forced Microsoft to change its business practices and products in Europe related to PC and server software. Most recently, it required Microsoft to offer a choice of Web browsers on new PCs running Windows 7.
That change is likely to benefit Google, Economides says.
“Google is the big winner because its browser is going to gain market share in Europe because of that ruling,” Economides said. Google will benefit from its well-known brand when new PC owners are asked to select a Web browser from a choice screen at startup.
For Google, it’s an easier way to gain market share than through advertising or product innovation.
But now it’s payback time, with Microsoft backing complaints that Google discriminates against certain companies in its search results.
Microsoft also has come out in opposition to Google’s proposed legal settlement with the Authors Guild and the Association of American Publishers related to its massive book scanning initiative.
The European Commission is tasked with ensuring that dominant companies do not unfairly restrict competition in the 27-country European Union. It previously has enforced hefty fines against Intel (INTC) and Microsoft.
