FTC Searches Google In Antitrust Investigation
Google now draws over a billion visits to its web sites each month, making it the world's largest web property. But what it might do with that market share has helped Google become federal regulators' target in a massive antitrust investigation.
It is not illegal for a company to have a monopoly — what experts say is illegal is how a company uses its monopoly.
"Have they unfairly excluded competitors in a way that will hurt consumers?" asks Bob Lande, a director at the American Antitrust Institute, a nonprofit research group. He's watching the Federal Trade Commission's investigation of Google closely.
"Google has this enormous power, and they have the incentive to unfairly exclude competitors in a way that could harm consumers," he says. "And the FTC wants to see whether this has happened."
It will be a difficult case to make: Google says the site is free to users, and if you don't like its results, you can go elsewhere for information.
And despite its dominant market share, Google argues it doesn't have a monopoly, pointing out there are other search engines like Bing. But more importantly, it says the FTC's notion of search is antiquated.
Matt Cutts, a software engineer at Google, explains that search is no longer relegated to just search engines.
"You can go online and ask your friends — whether on Twitter or Facebook — y'know, 'hey, I need a recommendation for a good bicycle' or something like that," he says. "It's not probably always going to be about the web. It might be bringing in things like social. It might be bringing in trusted experts."
Gary Reback, an antitrust attorney in the Silicon Valley, is credited with spearheading the government's massive antitrust case against Microsoft in the '90s.
He says in the case of Google, the government is also investigating whether the search engine unfairly puts its own results at the top. For example, if a user Googled "map of Pasadena," a Google map might come up above MapQuest.
"The allegation is that Google brings its own results up to the top of the search results, making them more visible and more valuable than competitors who actually would score higher on the normal relevance tests Google uses to rank search results," Reback says.
Google denies that it tips the scales in favor of itself. One of the many companies that disagrees is the online-travel company, Kayak.com.
"We believe there's a very compelling case that Google is abusing its dominant position in search to stifle competition and to extend its control over how information and commerce flows over the internet," says Robert Birge, the company's Chief Marketing Officer.
Birge offers an example, say you want to go to Tahiti:
"I think what would happen if you search for hotels from Tahiti, you're going to see a number of search results that appear to be unbiased search results from the Google search engine, when in fact they're a part of a new product that Google has launched last year — that's their own product — and is based on what advertisers are paying them," he says.
Google admits companies are sometimes unhappy with where they turn up in a search result, but not everyone can be first.
There are myriad accusations being made against the company, and given the scope, the FTC probe is ongoing. Similar cases have taken years to sort out.
But in this Google investigation, the FTC certainly has plenty of data it has to search through.