Congress and the European Union are preparing to take a hard look at Microsoft’s $44.6 billion hostile takeover bid for Yahoo.
On Sunday, Google strongly suggested the proposal should be rejected on antitrust grounds. In a blog post, Google chief legal officer David Drummond wrote, “Policymakers around the world need to ask these questions — and consumers deserve satisfying answers.” He added, “There is plenty of time for these questions to be thoroughly addressed.”
Congress wasted no time in taking the hint. House Judiciary Committee Chairman John Conyers (D-Michigan) and ranking Republican Lamar Smith (R-Texas) announced Monday that the committee will hold hearings on the proposed leveraged buyout on Friday.
“Microsoft’s bid to acquire Yahoo is certainly one of the largest technology mergers we’ve seen and presents important issues regarding the competitive landscape of the Internet,” Conyers said. The committee’s Task Force on Antitrust and Competition Policy will conduct “a careful examination” of the deal, Conyers said.
“We will need to scrutinize the deal carefully to ensure that it will not cause any harm to the competitiveness of what has been a vibrant high-tech marketplace, nor negatively impact the privacy rights of Internet users,” said Sen. Herb Kohl (D-Wisconsin), chairman of the Senate subcommittee on antitrust.
Neelie Kroes, the European Union’s competition commissioner, also said she intends to investigate the merger. Dr Hans Friederiszick, a former EU competition official, told the British newspaper the Telegraph, “If Microsoft bundled search and advertisement facilities into the Windows operating system, this would certainly be a concern.”
But what are the merits of antitrust complaints against the combination? Eric Goldman, director of Santa Clara University’s High-Tech Law Center, said in a telephone interview that regulators will look at several areas.
“Antitrust law turns on a multifactor analysis and is a little difficult to anticipate,” Goldman cautioned. “But…