The Anti-trust Case That Could Be In the Works Against Google
Google's market dominance in search and advertising, when combined with growing strength in a wide variety of online services like video, documents, telephony and more could be seen as the Internet equivalent of the monopolistic bundling that Microsoft faced government anti-trust action for in the late '90s. Fred Vogelstein wrote a long and important article on the case the government could be building against Google yesterday on Wired.com.
The Obama administration has appointed a Google critic who's invoked the Microsoft comparison directly in the past to now lead the US Justice Department's antitrust division. Wired's Vogelstein says that if legal action is going to be taken, it would require years of political work first to build up public support for prosecution in order to be successful. The government and Google have already begun to jockey for public favor in the pre-legal stage of the anti-trust dance.
Biasing Search Results
The anti-trust argument against Google is essentially that the company's secret search algorithms could be used to apply unfair, anti-competitive pressure to drive web users towards other Google services instead of services from other companies in markets like video, telephony, maps, email or whatever other markets Google moves into. It's like Micorosoft bundling Internet Explorer with Windows in a way that was unfair to competing browsers.
When a vendor uses monopoly power in one market to cut the air off from competitors in other markets, then there is less incentive for new competitors to bring innovation to those markets.
Google says its goal is to "organize the world's information" - but it is also doing an increasing amount of information delivery. The risk that the organizing could favor the company's own delivery channels seems worthy of consideration.
Is There Anything to Worry About?
Many people already say that launching a startup that competes with any Google product is suicide, just because of the company's size. (See the somewhat relevant story of Kiko's calendars, for example.) If investigators find reason to believe that Google is using its search dominance unfairly regarding non-search competitors, then anti-trust talk could turn into legal action. Talk itself, though, could help build that case with the public before it's built in court.
As Vogelstein explains in his Wired writeup, Google's "trust us, we don't believe in being evil" position doesn't hold a lot of water with anti-trust types. For the rest of us, though, we may believe that YouTube is the best online video site, that Gmail is the best webmail, that Google Voice is the best phone system, etc. and so not be surprised or upset to see those sites show up at the top of our search results pages regularly.
There was some concern that Google's Wikipedia competitor, Knol, would receive preferential treatment and dethrone Wikipedia from the top of many search pages, but that hasn't happened. That might be too obvious, or it might have been a sign that there's nothing to worry about.
How about you? Do you believe that Google's dominance across multiple technologies is unfairly anti-competitive? Do you trust Google to use its power wisely and fairly?
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I say "maybe" and "meh" to search anti-trust/monopoly law suits leveled against Google. No one is forcing people to use their search or buy AdSense ads...
Google Voice vs. the phone companies lawsuit would be a bazzillion times bigger!
It's their site, let them do what they want. Just like I think people have no right to tell Microsoft they can't ship IE with their own OS.
I think there's a potential anti-trust case to be made against Google, and I wouldn't mind the DoJ taking a look (and looking into Apple and the growing iTunes/iPhone monopoly and how they lock competitors out).
That said, the more pressing concern that Obama's DoJ should be looking into is miles away from web and personal technology. It's the major food conglomerates like Tyson, ConAgra, and Monsanto that keep consolidating and control the majority of our industrial food system in the US, bully farmers, and are making us sick.
Going after Google is losing the plot. The government's responsibility to its citizens is to keep us safe, imho, and Google is the little fish here.
This is very predictable. Obama campaign was about Change. What he meant by that is that he is changing the game by re-distributing the wealth. Robbing Paul to pay Peter. Yep, that's what a socialist administration is about. Rewards for taking risk (Google) is something that is viewed as evil. Google with its own properties (inalienable rights to what it owns) is being targeted by useless bureaucrats at the DOJ for prosecution. For WHAT? For simply protecting their own property (as their constitutional right) from other competitors who don't fund Google R&Ds or contribute to the cost of running its (Google) businesses except they think they have a right to its use by claiming that Google is prohibiting them.
Wake up America. The constitution protects property rights and not to violate them. Anti-trust is unconstitutional. People have to realize that there is no such thing as rights to what others own. You only have a right to what you own.
This is pathetic.
You should read the search marketing community's experiments with Knol. That preferential treatment for Knol certainly did happen, it's just that Wikipedia already had an entrenched brand so not many people paid attention outside of web geek circles like ours.
Gab said...
That preferential treatment for Knol certainly did happen
Gab, do you understand what property rights is?
Let me ask you this. Who owns Knol & Google ?
What makes you think that any website out there in the WWW has unlimited rights to Google's ranking engine? If Google decides that they want to shut down for a week for reasons of maintenance or perhaps some other reasons, then YOU nor anyone else don't have a right to cry-baby or demand that Google shouldn't do that, because you can't use the internet ie, unsearchable. It is not viable to do that, but I am highlighting here the concept of property rights, since you look like those who think that, because the law say so, it means that it is right. No, you're wrong. The anti-trust is unconstitutional, period. In other words, whatever Google does with its own property is theirs alone to decide and not the DOJ nor the consumers, even SEO people (parasites) such as yourself who make your living on top of Google's inventions. Without Google, there wouldn't be a Gab SEO, would it?
Learn about property rights & what the US constitution says about its protection. If Google up-ranked Knol and de-ranked others of similar to Knol, then it is none of your business (and all consumers) nor the DOJ to be concerned about it, because the property belongs to Google and they should be allowed to do whatever they like with what they own. It is theirs, not yours (nor the consumers).
@Falafulu Fisi
Socialism is about monopoly, don't be fooled (believe me, I'm French, I live in one of those neo socialist economies, we've got plenty of those monopoly here ;-)
@Josh Catone
So true, Google is not a threat to humanity, Monsanto is another story :(
Josh and Fabrice, I'm all for action against agricultural conglomerates over internet anything! Good point.
Antitrust laws are really about the concentration of market power in single entities and the damage that the market suffers when those entities serve their own interests above the public's. In a competitive environment there is no problem with that, but when companies approach a monopoly position the lack of a functioning market causes the system to break down.
A good example is what happened between IE and Netscape and the following years of stagnation in the browser market. After the antitrust measures in both the US and particularly Europe took hold, and Microsoft backed away from wanting to dominate the browser market a wave of competition has brought us some of the quickest advances in over a decade. Competition is good for technology and consumers.
In Google's case we are seeing the same problems starting to appear. I'm not sure if these problems always have to do with corporate intent or just with size and resources. Maybe the 'evil' in these situations is just a result of the size of the corporate entity. Simply put, after a company becomes a goliath it starts stepping on other companies and innovations have a hard time establishing themselves. Pure market presence causes innovation to slow to a crawl.
The number of companies Google has swallowed whole in recent years attests to the problem. Perfectly good, functioning innovative software companies just disappeared into the goliath's mouth never to be heard or seen of again, since they might not have any meaning to the larger corporate goals.
I wish people within Google's leadership would see what they have done and continue to do to stifle innovation. A large corporate entity has a responsibility beyond it's own self interest. If Google lives up to that responsibility, there will be no need for antitrust action. If not, that's what antitrust laws were made for.
The real question here is who determines what is in the public interest. If I want to use Google, that is a voluntary decision on my part, and if you don't, you don't have to. The problem is that business under an administration like the current one becomes a pee-wee football, everybody plays and everybody's a winner mentality.
That isn't the way the free market works. People make decisions, which contribute money to companies, the companies that get the most money win and continue to make more money. There are certain cases in which the government must step in, such as, when an electric company chooses to shut down which gives power to a hospital. This could be a danger to human life. However, there is no reason that the government should have any say in whether google gives preferential treatment to its products on its site.
If you (Joe Anyman) owned a dry cleaning service, Anyman's Cleaners, and you had a marketshare of ninety percent in the town where you did business, how would you react to the government (Which by the way should in no way be telling any private company what to do with its property provided it hasn't asked for a BAILOUT, which google has not.)saying that you needed to advertise another cleaner's services in your front window.
Most certainly in this case, any rational person would be up in arms. No, you would protest, this is my shop I bought the shop, I bought the land and I bought the window, and in no place on my property shall any sign be placed with the name of another cleaner.
However, when the property is online, and the owner is Google, no one else, Google, everyone acts like this is sooo different. It's not, in effect you're asking Toyota to advertise Chevys because Chevy doesn't do it well enough. That, my friends is utter Bullshit and some people need to pull out their copies of the constitution (and yes before some arrogant fuck decides to ask I own one) and read before posting a kneejerk reaction based on your personal buying/use preferences.
An asside is that though I absolutely despise microsoft, I was appalled at the EU for even thinking of doing this and had I been in microsoft's position I would have told them where they could shove their ballot screen and sold windows without a browser despite the whining. If you want a browser you can use telnet to download it via FTP or buy it on CD because the EU F**ked you over, the installer screen would read.
The Anti-trust Case That Could Be In the Works Against Google http://bit.ly/qArL [from http://twitter.com/marshallk/statuses/2782102563]
Posted by: Marshall Kirkpatrick
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August 10, 2009 10:41 AM
very thanks for article