"Google argues that the commission's proposed remedies, which include obliging its website to display ads "sourced and ranked" by rival companies, would only have a legal basis if it were a monopoly provider of essential supplies such as gas or electricity."
Interesting. So, Google isn't a monopoly or web search that it provides isn't essential supply. That means, as I understand, there are plenty of comparable rivals in the search area - or the search itself isn't particularly important today.
Is it so? Haven't heard about Europe-based - or anything-based search engines, which were as successful as Google, or even by half as successful. Similarly, I don't know many working people who don't search on the Internet daily. May be they can avoid doing that, but they probably don't want to.
Google is like a convenient highway that everyone takes to work: just because there are other routes (DuckDuckGo) it doesn't mean people will take them, and regulatory framework has to, in absence of a legitimate competitor (Japan prefers Yahoo! for some reason), treat Google as a functional monopoly.
Standard Oil held down prices which was good in theory for customers, but it was devastating for competitors and their employees, who spent like any other consumer. Europe's attitude towards Google isn't very free-market minded, but they are asking what kind of society they want, rather than having the economy as the be all and end all of their values.
EDIT: If you're going to downvote without explaining why, then you haven't really helped the conversation, you just made yourself feel less insecure about your own opinion.
If I have an idea for a better highway and money to build it, I still can't just build the highway. If I have a better idea for a search engine, I could wipe out Google.
Google is exposed to market forces, the highway isn't. Your analogy doesn't work at all.
And if I had an idea for a better social network, I could replace Facebook.
Just because there exists the opportunity for a competitor doesn't mean one will emerge. Until then (if it even happens!) the courts of Europe will continue to view Google as a disproportionately powerful force. Because it's an American company backed and staffed by people who fundamentally see the Internet and global economy in a different light than most Europeans (right to be forgotten, etc), Europeans have every reason to be suspicious.
> And if I had an idea for a better social network, I could replace Facebook.
Not necessarily. There are gigantic network effects propping Facebook up. A Facebook user who wants to try another social network needs to convince all their friends to move. And each of them has to convince their friends.
But to try another search engine takes takes about five seconds. You could switch from Google to Bing immediately and never look back, if you thought Bing were better.
Well, um, that's exactly my point. It's not that I can switch to another service, it's that other people won't, unless they each have a strong reason to. So if I feel a ubiquitous web service maligns my business, I should be concerned about their power over the populace, not just me.
Do you believe that every company with a dominant market share -- even one gained by building a better mousetrap -- deserves to have that power disrupted by the government?
If not, could you name an example of such a company that you would leave alone?
The potential for abuse exists anywhere, even if the choice to abuse isn't made. Likewise, the government should have the potential to disrupt a company, just as it should not do so unless it has an excellent reason.
This is a question of place and values. All things considered I think Google's market position is O.K., but if I were a European I would probably think differently. Not everyone wants to live by everyone else's rules (or End User License Agreement). If Europeans believe in antitrust action against Google, even if it is economically disruptive, we should respect that. Just as we should expect them to let us live as we desire elsewhere.
I think you misunderstood his argument. His point is that you won't switch from Facebook because your friends won't switch, while your friends have no bearing on your choice of search engine.
>Standard Oil held down prices which was good in theory for customers, but it was devastating for competitors and their employees
Uh, are you saying that Standard Oil should have made business decisions based on what was good for their competitors? This starts to get into collusion.
And I understand that the theory was that Standard Oil would hold prices down, running at a loss in order to kill off all competition, then raise prices as high as it wanted in a non-competitive market. But this doesn't seem to apply to Google's situation as customers can easily move to searching Amazon, eBay, etc. when shopping.
The problem wasn't just Standard Oil, it was the society around it. A purely free market society would see what the company was doing and close the books at that, but the government has a broader base of concerns. Namely, constituents of oil-producing regions who elected representatives to protect them.
Think of it like Wal-Mart: it may provide jobs and cheaper goods to a community, but the wealth is a net outflow towards the Walton family. Local businesses tend to recirculate their profits within the community through investment and higher spending, resulting in a broader standard of life increase.
Europe as a whole is much more concerned with quality of life than America, so it makes sense to see why they would view Google's homogenization of habit as a potential threat.
I think it's worth considering other societies' values when debating their laws compared to your own. There's a lot that America does right that Europeans want no part of, and vice versa. It really depends on who you are as a person.
> Think of it like Wal-Mart: it may provide jobs and cheaper goods to a community, but the wealth is a net outflow towards the Walton family
Providing jobs and cheaper goods to the community sounds like it's putting wealth into the pockets of the community to me. If you can buy a gallon of milk for the kids cheaper at Walmart then you can at the corner store, you have extra money for school supplies, medicine, etc.
>Europe as a whole is much more concerned with quality of life than America
Sorry, I have to roll my eyes at that comment and move on...
Except that everyone going to Wal-Mart for the cheaper goods has driven you out of a job because most of the stores in the area are now shut down and your significant other who does work at Wal-Mart makes exactly minimum wage and not a penny more. So your income is decimated and you have no extra money for school supplies, medicine, etc. Which is why the majority of Wal-Mart's employees are on government assistance. And now the rest of the community faces higher taxes to provide a greater security net. But hey, at least you saved $0.10 on that gallon of milk.
1: Unless Wal-Mart sells literally everything (health insurance, higher education, etc), then proprietors of other kinds of businesses will be hurt because average incomes have gone down. Milk may be cheaper but getting a contractor to tile my roof isn't.
2: Go to, say, Ravenna, Italy, and try to get a drink after midnight and on a weekday. You can't. The people there would rather all be on the same schedule (espresso for breakfast, big lunch with the family, work till evening, late dinner, then a stroll around town) instead of having their friendships and families be separated by the graveyard shift. As a hungry American at 2AM it was an inconvenience, but overall it works and people are happy.
If you're still unconvinced, ask a European what they think of paid parental leave, month-long vacations (inb4 productivity argument, Germany offers much longer vacations than America and has higher productivity per worker), national single-payer health care...I could go on. If Americans really, really cared about these things, we would have them by now.
So I wouldn't exactly want to model my economy on Italy.
>If you're still unconvinced, ask a European...
I've spent a lot of time in Europe and had long discussions in the pubs. Great times, nice folks, and I look forward to visiting again. but I still prefer the US.
My family in Gaeta knows the economy has been rough for a while, and yet their (and Italy's) strong social ties have kept society together in ways GDP and unemployment figures can't measure.
Contrast with China, where growth is less than double digits and everybody's losing their mind. GDP doesn't explain why someone on the street dying from a car crash can be ignored by hundreds of people who walk by because they don't want to get involved in something that isn't their problem (punitive laws that potentially transfer liabilities to involved bystanders don't help).
Society is more than economy. People often choose benefits to their society that tax economic growth, like preventing acid rain. If something seems irrevocably inconsistent about someone's decision, then I question the extent to which you choose to think from their perspective.
Just by way of comparison - Brit here. I'd choose to move to many countries over the US for various reasons:
1. Health care cost
2. Crime (especially violent and gun crime)
3. The lack of a political center ground or any sensible centrist discourse.
4. And of course - broadband and mobile data cost/speed ;-)
>Uh, are you saying that Standard Oil should have made business decisions based on what was good for their competitors? This starts to get into collusion.
This is exactly what some critics of antitrust law say happens:
> Under the Antitrust laws, a man becomes a criminal from the moment he goes into business, no matter what he does. For instance, if he charges prices which some bureaucrats judge as too high, he can be prosecuted for monopoly or for a successful “intent to monopolize”; if he charges prices lower than those of his competitors, he can be prosecuted for “unfair competition” or “restraint of trade”; and if he charges the same prices as his competitors, he can be prosecuted for “collusion” or “conspiracy.”
> and regulatory framework has to, in absence of a legitimate competitor (Japan prefers Yahoo! for some reason), treat Google as a functional monopoly.
Yeah, well, there's this outfit called Microsoft. They have this service called Bing. You may have heard of it. I'm sure that they'd be pretty offended to be told that they're not "a legitimate competitor".
You can have a legitimate competitor, and still have the majority of people prefer one. That's not the same as a monopoly.
Third "again" today, it doesn't matter that other options exist for me, it's that businesses and other institutions that rely on search can't expect other people to use anything but Google, thereby giving the company disproportionate influence.
If you're a business, and you're advertising on Google, but not on Bing and not on Yahoo, you're probably being pretty stupid - unless the revenue per dollar spent is higher for Google than for Bing and Yahoo. If you can demonstrate that it is, then you might have a case.
I only said "might", because the question isn't whether Google is more effective per dollar. The question is whether advertising on Bing generates more revenue than it costs. If it does, then businesses would be stupid not to also advertize on Bing.
Bing? Yahoo? Either of those ring a bell (pun not avoided)? Either of those active in Europe?
People can prefer Google without Google being a monopoly. There's competition, even though Google is ahead. (When multiple companies compete in a market, someone is almost always ahead.)
Google has effective competition. Winning against them does not make Google a monopoly.
You're right but Google continues to maintain that they are operating in a vigorously competitive environment. The minute they drop this assertion they will be the focus of antitrust investigations around the world.
It's about product search engines trying to force Google to rank them more prominently in search results. Which worries me a little, because I remember what Google's search results were like before they hit vertical search engines with the anti-spam hammer and it was an awful experience - page after page of worthless niche "search engines" all doing their best to convince you they had meaningful results, only to fail to deliver on their promise once you actually clicked the link. (Not forgetting the "review sites" with zero actual reviews.) And it didn't even matter to them because once you'd clicked, they'd made their money. Once they couldn't funnel people in through Google and had to convince users to actually search with them directly, it was the end because they had nothing worthwhile to offer.
The wheels of the legal system turn so much slower than the fierce competition and relentless change of technology markets. By the time this is resolved in the courts, Google probably won't even be dominant in search / ads anymore -- just like Microsoft lost its stranglehold on the browser market before the antitrust case was resolved.
You have your dates wrong. The US antitrust case was settled in 2001. Back then, there still was no real competitor to IE: Netscape had disbanded and Mozilla was still releasing only the full suite. Webkit did not exist (its predecessor KHTML was kinda crappy) and Chrome wouldn't be released before 2008. There is a line of thinking that says MS stopped working on the browser not just because they had killed Netscape, but because the antitrust case turned that market into a minefield. In any case, they had a full decade of dominance post-antitrust.
In any case, the whole process took about 3 years. Quite a lot in technology terms, but not really that long. 3 years from now, I don't see Google going anywhere nor any competitor taking over -- technology in search hasn't changed much in the last 5 years, if anybody could take a real shot at unseating google they would have done it by now.
It should be clear to anyone paying attention that Google is using their dominance in search to support their businesses at the expense of their competitors.
Just do a search for "Chicago Hotel" on a desktop browser. Unless you have a gargantuan screen, you will not see a single organic result. You will be given a list of paid ads, and then links to Google's local results. Clicking one of those local results will take you to another screen where you will see more paid ads, a Google Map, and a few seemingly organic results. But if you click on one of these "organic" results, Google then shows you a page where you can book a hotel room - and pay Google a fee for that.
I tried this, and it's true there are barely any organic results visible. 75% of what I do see are paid ads, either right bar or top bar.
But I don't see how paid ads are an example of using dominance to support their business though; paid ads are just a market that both hotels and resellers bid for space in. In fact, in my results above the google-box results are
All of those companies have to pay Google the instant you click on any of those ads.
In the past (when Google was touting their "Do no evil" slogan), you would have seen at least as many or more organic results to go along with the paid ads.
By pushing the organic way below the fold, Google is drastically increasing the odds someone will click on their ad. In fact, a lot of these companies are in the organic results but instead of getting their traffic for free, they'll have to pay Google for it.
I'd like to make clear - I have no problem with Google doing things that it deems good for it's bottom line. They have every right to do that, but that is why regulators exist - to make sure that when someone becomes the dominant player, they don't then use that position to eliminate competitors and extort customers.
If I ran a search engine it'd probably look exactly like Google's. That's not the point I'm trying to make.
Was Microsost wrong to use their position as the dominant OS to kill Netscape by effectively banning it from Windows installations? Was Standard Oil wrong to force railroads to not only give them massive discounts but also force the railroads to hurt Standard competitors?
What Google is doing and what Microsoft or Standard Oil did are fantastically profitable tactics that insure their long-term success. The question is, should they be allowed to do that without any restrictions?
During Microsoft's heyday, if your company used Windows and you wanted to try some other OS, you were out of luck: It would be enormously expensive to transition to another one -- you'd have to buy or write all new software and retrain all your employees.
But if you're a Google user and you want to switch to some other search engine... you just switch. Instantly.
Interesting. So, Google isn't a monopoly or web search that it provides isn't essential supply. That means, as I understand, there are plenty of comparable rivals in the search area - or the search itself isn't particularly important today.
Is it so? Haven't heard about Europe-based - or anything-based search engines, which were as successful as Google, or even by half as successful. Similarly, I don't know many working people who don't search on the Internet daily. May be they can avoid doing that, but they probably don't want to.
Sounds strange.