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US probes B2B marketplaces

The US govt looks into fears that business to business marketplaces may encourage anti-competitive practices.

As more business competitors join to create or participate in online marketplaces, government regulators are becoming concerned about the potential for anticompetitive activities.

The Federal Trade Commission last week put marketplaces under a microscope during a two-day public hearing that featured testimony from top technology companies, industry associations, major companies, analysts, and academics.

The FTC sought information on the benefits of online markets, how prices are determined, ownership structures, confidentiality of information, coercion, and exclusion.

"They're clearly concerned about whether this new phenomenon of online marketplaces will give new players a choke point on commerce," says Tim Clark, an analyst at Jupiter Communications. FTC officials, he says, "are a little bit ahead of themselves."

Technology companies and online marketplace businesses testified that it's too early for the government to get involved and urged it to tread lightly in regard to regulation.

The FTC and the Department of Justice are scrutinizing the competitive implications of several marketplaces, including those created this year by the automotive and airline industries.