Google's Bid to Acquire Motorola Faces DOJ Scrutiny
Is the DOJ's second request for more information about the proposed acquisition routine, or a roadblock?
In brazen defiance of modern tradition, the U.S. Justice Department appears to attempting to enforce U.S. laws as though they have the authority to do so granted to them by the U.S. Constitution. Less than a month ago, they surprised everyone by actually noticing that AT&T's attempt to purchase T-Mobile probably runs afoul of U.S. Anti-Trust law, and issued a motion to block the acquisition. And it appears that they're treating Google's proposed purchase of Motorola Mobility with similar skepticism. Today, news emerged that the DOJ has made a second request for information about the buyout. (The full document is available online).
Naturally the Google/Motorola Mobility deal isn't saddled by the same issues as the proposed AT&T/T-Mobile combo. AT&T and T-Mobile offer competing products; a merger would necessarily reduce market competition and give AT&T an unfair edge. Google and Motorola Mobility do not actually compete with one another directly and it's therefore likely the deal will ultimately be approved. However, Google business practices have come under increased scrutiny as of late, culminating in recent congressional hearings investigating whether the company behaves in a monopolistic fashion. It's therefore refreshing to see the DOJ continuing that scrutiny after a decade dominated by a less strict approach to business law enforcement.
That company is the text-book definition of what you shouldn't be allowed to do.
I am against monopolies where ever they spring up. I don't believe that google should be allowed to buy motorola.
"...the U.S. Justice Department appears to attempting to enforce U.S. laws as though they have the authority to do so granted to them by the U.S. Constitution."
Is it the Dept. of Justice's job or not? If it is their responsibility to enforce anti-trust laws then more power to them. I hardly consider the DOJ asking for information TWO separate times to be a roadblock when it comes to multi-billion dollar business takeovers.
I can see how selling only the profitable bits to Google while leaving the rest of Motorola to wither could be cause for concern
So what do you think should be done about Apple then? Google buying Motor would let them control the hardware and software on a phone, does that remind you of a certain fruity company? If this can be a monopoly then Apple already is and should be stopped. Following your logic that is.
The antitrust laws cover not only practices against direct competitors but also to towards business affiliates and adjacent markets (Intel rebates anyone?). Time to freshen up on Antitrust laws. Therefore this scrutiny is perfectly appropriate. The reason antitrust laws probably won't apply here is the other argument - that neither company is in a monopoly position in either of the markets, but even that is not clear cut. Android already integrates Google Search the way Microsoft Windows used to integrate Internet Explorer, so the search monopoly is still very relevant. Again, since Android is not in a monopoly position in the cell phone OS market this would probably mean Antitrust laws wouldn't apply (for now, but now is what matters).
I'm rather surprised Google has managed to keep antitrust litigation at bay until now. Maybe they have insider connections and big money flowing that way.