AT&T, Google and the Obama Administration

It’s funny what a million dollars in political contributions, support for the right candidate and a liberal meme can buy you in Washington these days. For Google, it is buying them a free pass as they amass growing power in Washington and the marketplace.

AT&T, while unionized, does not have the same liberal bent as Google. They are more a traditional Beltway player. Open Secrets.org describes their strategy as “Although the company has historically favored Republicans in its political giving, people and political action committees associated with AT&T have as of late generally split their contributions between Democrats and the GOP.”

Recently both Google and AT&T made strategic acquisitions. How they were treated by the politicized Department of Justice makes an interesting statement.

Google is a giant and growing by the day. Google purchased Motorola and ITA Software, which builds online flight and ticket information software for travel websites. Google paid $700 million for ITA and Motorola for $12 billion. The acquisition of ITA allows Google to corner the market for travel and Motorola gives Google monopoly on thousands of patents that will help stave off competitive threats and patent-infringement lawsuits.

Despite howls of protests from the travel industry, that feared Google would crowd out other travel websites when combined with Google’s search engine. Yet the Justice Department approved Google’s purchase with a caveat, Google must also set up a formal reporting system for anyone who believes it is acting unfairly. With regard to the purchase of Motorola, DOJ seems poised to approve the purchase as well.

But for AT&T, the Department of Justice has been less than hospitable. DOJ has filed a lawsuit trying to block the purchase of T-Mobile, arguing that it will hurt competition.

Did Google’s purchase of critical software so relied upon by the travel industry “hurt competition?” Perhaps AT&T should offer to set up an informal reporting system for anyone who believes his or her calls didn’t go through.

All of this smacks of disparate treatment and crony capitalism. With control of over two thirds of the search engine traffic, Google is the largest search engine – a gateway to the Internet – yet DOJ is allowing them to get even bigger. Has the relationship between Obama and the company played a role in the decision-making? Sure seems like it.