Nathan Newman has an article in the Huffington Post titled "The Case for Antitrust Action Against Google."
It's largely nonsense.
Here's the real reason why regulators are trying to build a case:
1. People love underdogs and fear dominant companies.
2. Competitors will attack companies in court when they can't compete in the market any other way.
3. Companies that can't game Google's ranking system to raise their results will try to hobble its power and get back the ability to cheat the search algorithms.
Here are the complaints Newman raises:
He quotes a release from the Senate Antitrust Subcommittee that says that some e-commerce sites that compete with Google CLAIM they're treated unfairly in their rankings.
Nonsense. See my point 3 above. Google got its start by refusing to bias search results. Every search engine used to rank paid advertisers higher in search results until Google came along. In a meeting with Google in 2001, an AOL executive meeting with Google said Google was "stupid" for not doing the same. Sergey Brin walked out of the meeting and said, loud enough for people in the meeting to hear, "Someone get me a can of gasoline. I have to set myself on fire to get rid of the scum of these people."
Larry and Sergey have always felt that they are trying to do something great for the world, something too important to cheat. My constant example: type a stock ticker symbol (GOOG or MSFT) into Google or Yahoo, and the search engines know you're looking for stock info, so they give links to Yahoo Finance and Google Finance. Both search engines list Yahoo Finance first, because more people link to it than to Google Finance.
The main point is that Google's honest search results work. They give better results, which makes Google more popular, which makes more people use Google. Why mess up a system that works?
Competitors also complain that they are treated unfairly in their ability to buy search ads.
Also nonsense. Google gives preference to advertisers who have relevant ads. If you pay $500 for an ad linked to a keyword that is not relevant, the ad will drop below someone who pays $10 for a more relevant ad. The ranking is based on how many people actually click on the ad. Google only gets paid when people click on an ad. So why accept irrelevant ads from companies willing to pay a lot of money, when nobody clicks on them? Google's entire revenue stream is from advertising, so eliminating relevant ads would be just plain stupid.
Newman also quotes Michael S. Lee, R-UT, who says Google's dominance "creates myriad opportunities for anticompetitive behavior."
See point 1 above. Yes, any dominant company has ample opportunity to cheat. But it's a sad indictment of modern capitalism that people assume that the OPPORTUNITY to cheat means a company WILL do so. I have found Larry and Sergey to be two of the most honest and idealistic business executives I have met in my 30 years as a business reporter. I see no evidence that they cheat, or even want to.
Lee also thinks Google's dominant position reduces its incentive to provide the best privacy protection.
However, Google has always shown a stronger willingness to protect privacy than its competitors. People cits the "wi-spy scandal," as Newman calls it, when Google collected private info from wi-fi signals when it was taking pictures for Google Maps. The company said it was a mistake, stopped the practice, and never did anything with the data. It would like to delete the data, but all the anti-trust suits force it to keep it for evidence. I'm more skeptical of corporate claims than most, but I do not see what Google could possibly gain from something like this except losing the goodwill of its users. Nobody has ever shown any evidence of Google misusing private data. If you think Google does misuse your data, then go to Bing. I'm sure Microsoft is more reliable.
Newman says that when Microsoft was being investigated by anti-trusters, some people said it was just being attacked because it was a dominant company, implying that idiots like me must be just as stupid as the Microsoft apologists. I covered Microsoft for a decade, and used to have great respect for the company, but the evidence of manipulating the market became clear, and I said so. Google is not in the same category.
Newman then gives a lot of "what if?" scenarios without providing any evidence:
Newman says Google is "in the business of reselling aggregated data," so "if" it isillegally breeching privacy, that's an anti-trust violation. Huh? I'm just too stupid to follow his argument. Google is in the business of selling ads, not data. Why screw up the huge ad business to benefit some supposed minuscule business of selling data?
Newman says Google is "accused" of manipulating search results to punish competitors. See item 2 above. Newman cites the case of Foundem, a UK search site, which saw its site disappear from Google search rankings for three years. No evidence that Google unfairly manipulated its system to demote Foundem, just an accusation. Google does manipulate search results in order to try and exclude sites that manage to game its system. Like when it demoted J.C. Penney for gaming the system so that it appeared first in search results for words like "dresses," "bedding," "area rugs," "furniture" and other items where JC Penney clearly does not lead. Punishing cheaters is not the same as punishing competitors. Any company that says Google is biased against it should provide some evidence that the company deserves to be higher in the results.
Google pulls up the sites that are most popular. That's why it wins. It's not a perfect system, because new sites that have not yet become popular are at a disadvantage. But that doesn't mean Google is cheating.
Newman says, without evidence, that it locks up the search syndication market with "exclusive" deals with PC makers, ISPs, software vendors and others. Really? That's one of Microsoft's own tactics. I can't say it doesn't happen, just that I've never seen the evidence. Show me the deals and I'll reconsider. My HP computer makes Internet Explorer and Bing the default programs. It even brings up a Bing search bar whenever I start up the computer, even though I've changed my default to Google. I have to close the Bing window every time. It makes me less likely to buy from HP again, because it's obviously making deals that are not in my best interest.
And finally, Newman says Google is accused of making it difficult for advertisers to port their data to competing ad platforms. I just wish he would show some evidence for this. His link on this topic just leads to another article that also makes the accusation without evidence. If the accusation is true, it should be possible to find someone who was not allowed to port their data, just as it was possible to find PC makers who said Microsoft charged them more if they didn't agree to use Windows exclusively.
So I don't get Newman's argument. He says the problems he listed means there should be anti-trust action against Google. "The question is why not force Google to act more competitively?" he writes.
I'm sorry, but without evidence that Google is unfair or uncompetitive, anti-trust suits are just pandering to companies that can't compete in the market. If competitors can force anti-trust investigations without evidence, it costs taxpayers and the accused company money, time and attention.
And that's what I would call unfair market hindrance.