Google Probe Accelerates as U.S. Questions Site Operators

U.S. antitrust regulators told EBay Inc. (EBAY) and Yelp Inc. (YELP) to provide information on whether Google Inc. (GOOG) is competing unfairly, speeding up a probe that began a year ago, people familiar with the matter said.

The shopping and review websites were among about a dozen companies that received civil investigative demands, which are similar to subpoenas, from the Federal Trade Commission last week, said a person familiar with the matter who wasn’t authorized to speak publicly.

In its requests, the FTC is seeking examples of Google failing to follow through on promises to direct consumers to websites that compete with its own services, according to the person and three others familiar with the matter, who also weren’t authorized to publicly comment.

Agency officials also asked if Google, the world’s most popular search engine, is selling rivals prime advertising space on search results pages, according to the four.

Companies receiving demands also include NexTag Inc. and TheFind Inc., which run shopping websites, two of the people said.

Mistique Cano, a spokeswoman for Mountain View, California- based Google, and Cecelia Prewett, an FTC spokeswoman, declined to comment.

Changes in Results

The FTC wants to know the impact of changes Google made in February 2011 to the mathematical formulas that rank its search results, two of the people said. Some websites reported losing almost half of their user traffic following the changes.

Allegations made by Yelp that Google uses other sites’ content without permission in its search results also are being investigated, one of the people said.

The FTC, which has sent out previous legal demands to Google and companies including Microsoft Corp. (MSFT), is examining rivals’ complaints that Google favors its own services in search results. In November, Gary Reback, a lawyer who represents Internet companies, including NexTag and TheFind, urged the agency to immediately seek information from shopping websites.

The new demands for information are “a great step in the right direction,” Reback said. “I just don’t know how big of a step it is.”

Litigator Hired

Reback declined to say whether his clients received the FTC demands. Dave Cook, vice president of marketing for TheFind, declined to comment on the FTC requests. Luther Lowe, a spokesman for Yelp, declined to comment, as did Shannon Eis, a NexTag spokeswoman. Johnna Hoff, an EBay spokeswoman didn’t respond to an e-mail and phone calls.

Last month the agency hired Beth Wilkinson, a top Washington litigator, to run the antitrust investigation, signaling that the agency may be preparing to sue Google.

Joaquin Almunia, the European Commission’s antitrust chief, told reporters yesterday that Google has a “matter of weeks” to resolve a probe and avoid possible fines over allegations of discriminating against competitors.

To contact the reporter on this story: Jeff Bliss in Washington at jbliss@bloomberg.net; Sara Forden in Washington at sforden@bloomberg.net.

To contact the editor responsible for this story: Steven Komarow at skomarow1@bloomberg.net; Michael Hytha at mhytha@bloomberg.net.

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