Italy's antitrust agency said on Friday it was broadening its investigation into allegations that Google's Italian news website coerced Italian newspapers into posting their stories to include U.S. parent Google Inc. The competition authority launched the probe this week after the Italian Federation of Newspaper Editors alleged that any publication refusing to appear on the Google News Italia (http://news.google.it) website was excluded from Google's search engine.

Considering that, from the assembled documents, it appears that Google News Italia is managed by the company Google Inc ... it is deemed necessary to broaden the ongoing investigation to the company Google Inc., the competition watchdog said in a statement on its website (http://www.agcm.it/).

It said the company had 30 days in which to present its case to competition authorities.

A spokeswoman for Google in Italy was not immediately available for comment.

The newspapers have alleged that Google's use of their online material on its Italian website hurt their ability to attract readers and advertisers to their home pages but if they did not allow them to appear on the site they were barred from its search engine.

The antitrust body, which opened the probe under EU law governing the abuse of dominant market position, said it was investigating whether Google was distorting the online advertising market.

Google and its competitor Yahoo face complaints from news providers in the United States and elsewhere that their search engines make money from news generated by others.

Google has argued that it helps newspaper websites make money through online advertising and does not misappropriate content.

(Reporting by Daniel Flynn; editing by Karen Foster)

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