[h=3]By AMIR EFRATI[/h]The Federal Trade Commission has begun to examine complaints by rivals of Google Inc. that the Internet giant abused its power in the market for selling online-graphical and video ads, according to people briefed on the matter.
The inquiry comes just months after the agency ended its yearslong antitrust probe of Google's Web-search engine and search-advertising business.
The FTC's examination is in its early stages, these people said, and may not result in a formal probe.
Spokespeople for Google and the FTC declined to comment. Bloomberg News earlier reported on the FTC's interest in Google.
The FTC six years ago said it would monitor Google's behavior in the online-advertising market, where the company generates almost all of its revenue, after it acquired a online-ad company DoubleClick. That business became the foundation for Google's graphical and video ad-brokering services, now a multibillion-dollar business.
Some of Google's advertising-technology rivals have complained to antitrust authorities that Google has allegedly combined several of its ad-related services for website publishers so that the publishers would have to use them all rather than just one Google service, according to people familiar with the matter. That process is known as "tying" or "bundling."
There is no evidence that website publishers themselves have complained to regulators.
In the U.S., Google last year generated $2.26 billion from sales of graphical and video ads, also called "display" ads, or 15.1% of the $15 billion market, according to research firm eMarketer Inc. Much of the revenue is generated by Google's YouTube video site, which sells display ads.
Google also has built a substantial business from helping advertisers find ad space on millions of websites. Google plays this matchmaking role through its Google DoubleClick Ad Exchange, a kind of automated marketplace that generates fees for the company.
And Google generates fees from helping websites track their automated advertising sales through an "ad serving" system called DoubleClick for Publishers, which is dominant in the industry. Google has special tools to help advertisers buy ads across millions of sites in an automated fashion.
At least one rival has complained to regulators that Google allegedly is prohibiting website publishers who use DoubleClick for Publishers to use non-Google technology to help the publishers manage how they sell their ad space, said a person familiar with the matter. Instead, the rival has claimed, Google has pushed or financially incentivized publishers to use Google's own AdMeld service to manage how they sell ad space to advertisers. In some cases, Google rivals have said the company is waiving fees for some of its services if website publishers decide to use them rather than services provided by those rivals.
The display-ad business, which Google previously said would generate about $5 billion in gross revenue in 2012, has helped the company shake the notion that it could only make money from selling small text ads that appear next to results on its Web-search engine. Google in recent years surpassed Facebook Inc., Yahoo Inc. and AOL Inc. in generating display ad-related revenue, eMarketer has said.
Since acquiring Doubleclick for $3.1 billion in 2007, Google has spent more than $1 billion more on acquisitions of various display-ad and mobile-ad firms.
In deciding not to block Google's DoubleClick acquisition, the FTC in December 2007 said in a public statement that it noted concerns that Google could potentially use DoubleClick's market position to boost Google's other advertising products.
"The markets within the online advertising space continue to quickly evolve, and predicting their future course is not a simple task," the agency said, adding that it "will closely watch these markets and, should Google engage in unlawful tying or other anticompetitive conduct, the Commission intends to act quickly."
—Brent Kendall contributed to this article.
The inquiry comes just months after the agency ended its yearslong antitrust probe of Google's Web-search engine and search-advertising business.
The FTC's examination is in its early stages, these people said, and may not result in a formal probe.
Spokespeople for Google and the FTC declined to comment. Bloomberg News earlier reported on the FTC's interest in Google.
The FTC six years ago said it would monitor Google's behavior in the online-advertising market, where the company generates almost all of its revenue, after it acquired a online-ad company DoubleClick. That business became the foundation for Google's graphical and video ad-brokering services, now a multibillion-dollar business.
Some of Google's advertising-technology rivals have complained to antitrust authorities that Google has allegedly combined several of its ad-related services for website publishers so that the publishers would have to use them all rather than just one Google service, according to people familiar with the matter. That process is known as "tying" or "bundling."
There is no evidence that website publishers themselves have complained to regulators.
In the U.S., Google last year generated $2.26 billion from sales of graphical and video ads, also called "display" ads, or 15.1% of the $15 billion market, according to research firm eMarketer Inc. Much of the revenue is generated by Google's YouTube video site, which sells display ads.
Google also has built a substantial business from helping advertisers find ad space on millions of websites. Google plays this matchmaking role through its Google DoubleClick Ad Exchange, a kind of automated marketplace that generates fees for the company.
And Google generates fees from helping websites track their automated advertising sales through an "ad serving" system called DoubleClick for Publishers, which is dominant in the industry. Google has special tools to help advertisers buy ads across millions of sites in an automated fashion.
At least one rival has complained to regulators that Google allegedly is prohibiting website publishers who use DoubleClick for Publishers to use non-Google technology to help the publishers manage how they sell their ad space, said a person familiar with the matter. Instead, the rival has claimed, Google has pushed or financially incentivized publishers to use Google's own AdMeld service to manage how they sell ad space to advertisers. In some cases, Google rivals have said the company is waiving fees for some of its services if website publishers decide to use them rather than services provided by those rivals.
The display-ad business, which Google previously said would generate about $5 billion in gross revenue in 2012, has helped the company shake the notion that it could only make money from selling small text ads that appear next to results on its Web-search engine. Google in recent years surpassed Facebook Inc., Yahoo Inc. and AOL Inc. in generating display ad-related revenue, eMarketer has said.
Since acquiring Doubleclick for $3.1 billion in 2007, Google has spent more than $1 billion more on acquisitions of various display-ad and mobile-ad firms.
In deciding not to block Google's DoubleClick acquisition, the FTC in December 2007 said in a public statement that it noted concerns that Google could potentially use DoubleClick's market position to boost Google's other advertising products.
"The markets within the online advertising space continue to quickly evolve, and predicting their future course is not a simple task," the agency said, adding that it "will closely watch these markets and, should Google engage in unlawful tying or other anticompetitive conduct, the Commission intends to act quickly."
—Brent Kendall contributed to this article.