Japan's Rakuten e-retailer complains about Yahoo-Google deal

Japan's top e-retailer Rakuten said Wednesday it had complained with the country's fair trade watchdog that an Internet search alliance between Yahoo! Japan and Google would monopolise the market.

Under the deal announced in July, market leader Yahoo! Japan will start using Google's search technology this year, also deploying its advertising and distribution system, while maintaining its current user interface.

"The tie-up by the two firms will lead to an information monopoly for Google Inc," Rakuten said in a statement released Wednesday.

"The deal threatens to hinder not only the search engine sector but also many Internet services in the country from developing.

"We believe the alliance needs to again be discussed and examined substantially by authorities such as the Fair Trade Commission."

Yahoo! Japan said in July it had about a 57 percent share of Japan's search market, the third-largest in the world, while Google had about 37 percent, and Microsoft had around three percent.

Following the announcement of the tie-up, the Japan Fair Trade Commission said it saw no monopoly problem with the search alliance.

But Microsoft reacted quickly to denounce the deal, saying it would give Google near-total control over the Japanese market.

Rakuten is a top Internet retailer rapidly expanding its global operations, having launched a new online shopping mall in China this week.

It acquired French e-commerce dealer PriceMinister earlier this year.

Rakuten has also bought Buy.com, one of largest e-commerce sites in the United States, while it has entered the Indonesian e-commerce marketplace through a joint venture with Global Mediacom.