Obama Anti-Trust Chief on Google the Monopoly Threat 364
CWmike writes "The blogosphere regularly excoriates Microsoft for being a monopoly, but Google may be in the cross-hairs of the nation's next anti-trust chief for monopolistic behavior, writes Preston Gralla. Last June, Christine A. Varney, President Obama's nominee to be the next antitrust chief, warned that Google already had a monopoly in online advertising. 'For me, Microsoft is so last century. They are not the problem,' Varney said at a June 19 panel discussion sponsored by the American Antitrust Institute, according to a Bloomberg report. The US economy will 'continually see a problem — potentially with Google' because it already 'has acquired a monopoly in Internet online advertising.' Varney has yet to be confirmed as antitrust chief, and she said all this before she was nominated. Still, it spells potentially bad news for Google. It may be time for the company to start adding to its legal staff."
Monopoly on online advertising is the least of it (Score:4, Insightful)
But... (Score:5, Insightful)
Only if it is abused, no?
Monopoly? (Score:3, Insightful)
I thought that having a monopoly was legal, but that protecting it via illegal means was not. What, exactly, has Google done to illegally protect the alleged monopoly?
Also, it's hard to see how they create a barrier to entry in the market. Any idiot can set up an online advertising agency and start making deals (and many idiots have done precisely that).
Hmmm... (Score:2, Insightful)
Forgive me, but I completely fail to see how Google could be considered a monopoly. They offer services that are supported by their advertising revenue.
They collect information about you, yes - we all know this may be evil.
But anti-competitive? AFAIK, their only source of revenue is their advertising business. Are they under-selling ad pricing? My gut feeling is that their services exposure is such that people would probably pay some premium to advertise with Google versus other sites.
Unless my understanding is completely off-base, it almost sounds like you can become a monopoly to this person simply by being better at what you do.
Because you didn't fix it last century! (Score:5, Insightful)
For me, Microsoft is so last century. They are not the problem.
I don't know about you, but my father uses Windows. My mother uses Windows, except for an old machine I've set up for her music library on Linux. My brother uses Windows. His friends all use Windows. Most of my friends use Windows, except the few who have Macs -- and those run Windows in a VM.
Even I use Windows -- VM or dual boot.
I've finally reached a point in my life where I don't have to touch Windows more than once a week, unless I want to play a game. And yet, I still can't design web apps the way I want -- I still have to either force everyone to download Firefox, or spend around 10% extra development time supporting Internet Explorer. (And I can't develop IE-only, or I don't have Firebug.)
If you don't see Microsoft as a problem, you aren't looking. If you see them as "so last century", it's because you let them get away with it last century!
I'm not going to defend Google, but that statement is dangerous thinking. Just because everyone forgot about the problem doesn't mean it's gone.
Re:Monopoly on online advertising is the least of (Score:5, Insightful)
Google's ability to combine search data from maps, Google Earth, Web Search, Google News Alerts, etc, and mine it is a much bigger problem.
Why? Because they've built a better mousetrap, and now people want to use it?
Google isn't even close to being a monopoly. I'm not a slobbering fanboy of Google the way some other people are, but I also fail to see a business boogeyman behind every corner as some people do. Some people's concept of "anti-trust" would be more correctly called "anti-success"... this notion that a company that's been very successful must have cheated or done something nefarious to get that way.
monopoly isn't a problem... (Score:5, Insightful)
... abusing your monopoly is. I read the article hoping to see some indication of how Google is keeping other competitors down or acting against the public good; didn't find it. My conclusion: not yet an issue.
Monopolies are not really a problem... (Score:4, Insightful)
Microsoft has had a few clear cases where it abused its monopoly. Google? I am not so sure, though of course any monopoly bears keeping a close eye on.
Assuming they're a monopoly for a moment... (Score:3, Insightful)
Assuming they're a monopoly for online search advertising, in what way are they either abusive, or even able to abuse their monopoly status? With Microsoft, the monopoly is/was harmful to the marketplace of ideas because they wrestled to own and exploit shared standards, used bundling agreements and legal manipulation to hinder competition, and so on.
Even assuming Google could be considered a relative monopoly, if they were to use most of the problematic parts of that monopoly status, another company could just swoop in to replace them. Their power lies in their perceived results and goodwill with their large user base, rather than just being the only choice for most people.
I'm not normally a libertarian philosopher, but it seems to me this is one of the truest cases where the marketplace really can sort things out almost completely.
Ryan Fenton
fanboy (Score:4, Insightful)
Its hard to not sound like a fan boy of google, but I'm currently not understanding why google would be considered as a monopoly, but if I was to play devil's advocate here I might argue the following:
I don't agree with these, but some could argue (if you really didn't like google anyway).
Re:But... (Score:5, Insightful)
Correct. A monopoly position is not illegal. Using it to punish competitors or as a means of compliance is.
Google should be watched for abuse of their monopoly power in advertising, but so far I don't think there is any existing evidence to show abuse.
We have yet another person obtaining a position of power after displaying evidence of prior bias, but that's just how politics work. Fortunately, Google has the resources to vigorously defend themselves against spurious charges of monopoly abuse. Unfortunately, Google has the resources to vigorously defend themselves against non-spurious charges of monopoly abuse.
Re:But... (Score:5, Insightful)
The question being... how could you use a monopoly on advertising to keep other advertising companies from effectively advertising?
Ehhh, who cares (Score:4, Insightful)
She's expressing an opinion, that's not allowed? (Score:3, Insightful)
Wait a minute, are you saying that anti-trust lawyers that might, at some point in the future, end up working for the FTC should refuse to express an opinion of any kind about any company that may or may not be the subject of future regulatory action in a job they do not yet have and may never have? (Yes, that is a long sentence.)
You know, this kind of attitude might be something of a problem when it comes to Supreme Court Justices. Since we kind of expect Justices to have actually written legal papers expressing opinions of various kinds (as lawyers, and maybe judges), written opinions, and represented clients, at some point before they join the Supreme Court.
People are allowed to have, (and express in a public forum), opinions before they are government employees. Certainly those views can be brought up and considered during confirmation hearings, but having and expressing an opinion does not disqualify somebody from appointment to an executive branch position.
Indeed, since they are appointed positions, all but the most extreme people completely unfit for office are supposed to be confirmed, no matter which side of the political spectrum they are on.
SirWired
Intel and Cisco (Score:5, Insightful)
Having a monopoly (in legal terms) is not, as many have pointed out, illegal, but it does constrain your behavior somewhat, and it does mean that the Justice Dept is probably going to want to keep an eye on you. I don't see anything in TFA suggesting that Google is going to be prosecuted--merely that they're going to be scrutinized, and frankly I think that's a good thing. I'm more worried about the suggestion that Microsoft is no longer a problem.
Intel and Cisco have both also been judged to have monopolies in their respective fields, but unlike Microsoft, they've (mostly) played by the rules, and haven't ended up in serious trouble. Doesn't mean the Justice Dept won't continue to keep an eye on them, though. I have no problem with Google being lumped in with Intel and Cisco. On the other hand, I don't want them lumped in with Microsoft until someone finds evidence of similar anti-competitive behavior. On the gripping hand, if evidence of anti-competitive behavior is found, I want them prosecuted, but I'm not holding my breath waiting for that day.
Re:here we go again.. (Score:2, Insightful)
Google has many competitors, Microsoft being a major one but certainly not the only one. I doubt there is any foul play going on. Keep in mind that Google is a company, and a big one at that. They have a lot of monopolistic advantages. Whether or not they abused them is in the eye of the beholder, but they certainly have a hold on many different parts of the tech industry.
I'm not doubting that, I'm just commenting on Varney's comment regarding the issue. The way she addressed the issue (For me, Microsoft is so last century. They are not the problem...) suggests to me that someone at Microsoft put her up to it. Either that, or she is one of the most clueless people the Obama administration has to offer.
Cloud Computing (Score:4, Insightful)
Re:here we go again.. (Score:3, Insightful)
Perhaps, but it's just as likely that Google isn't playing like they want them to, which may include not offering (the party) a bribe, which politicians have become a custom to (in all parties)
Re:here we go again.. (Score:5, Insightful)
And exactly how did they get that hold? Cuban derided anyone who might want to buy Youtube.com. Google made it work. Google has taken billions of pictures of the planet and shared them with everyone. Google 'mashups' are plentiful and some incredibly useful. Despite Google's very large footprint on the Internet and how it is used, what harm has come from their activities? What good?
Until someone can show that Google has harmed competition with their advantages, there is nothing to argue about. They got that hold by being useful and free (mostly) and helpful. Google has quite literally begun setting the standards for others to follow. That they did not follow quickly enough is not Google's fault.
We, the consumers, share some of the guilt. We should have demanded of our service and content providers that they do what Google has. Wait a minute, scratch that. Our service and content providers should have listened... never mind.
Re:Monopoly on online advertising is the least of (Score:2, Insightful)
As a brief example, I don't see Google removing competitors from search results nor making gmail non-compliant with other hosts. Sorry, but no.
Re:But... (Score:4, Insightful)
Re:That's scary (Score:5, Insightful)
Does she not know what a monopoly is? And I've yet to hear how Google is using its leverage to stifle competition and/or gouge its customers.
Yes she knows what a damn monopoly is. She knows that a monopoly is not in and of itself illegal. She said she thinks Google has a monopoly in online advertising, and that they acquired it legally. She said nothing that indicates she thinks Google is abusing that monopoly today.
What she is concerned about is cloud computing -- i.e. net apps like Google Docs -- and that Google could make interoperating with their software difficult just like Microsoft has/is. That is in fact a legitimate concern. If it happens, I'd like for a regulator to step in sooner than the government did with Microsoft, and if it doesn't, I don't see anything that says she'll pursue anti-trust against Google just because.
I'm really not getting what everyone is getting their panties in a twist over.
Re:Monopoly on online advertising is the least of (Score:2, Insightful)
Many people would disagree with your assessment of Microsoft making a better product than the other guys at any point in history, even if you weren't wildly extrapolating from DesScorp's statement.
The real problem is that an operating system locks you into using it far more than anything Google's done so far--a problem which isn't Microsoft-specific. At this point, it'd be far easier for me to move cross-country than change my OS. Once a lot of people are in a similar position and have major incentives to use the same OS as everyone else, it's difficult NOT to be an abusive monopoly.
Re:here we go again.. (Score:4, Insightful)
Or that maybe, just maybe, she's an independent thinker who believes (perhaps wrongly) Microsoft isn't a problem.
GP already said "Either that, or she is one of the most clueless people the Obama administration has to offer."
Cluelessness and wrongly believing things are kinda the same thing here...
A monopoly in advertising? (Score:5, Insightful)
If they are looking for a company that hods a monopoly in advertising, they should look somewhere else [clearchannel.com]
Re:here we go again.. (Score:3, Insightful)
I'm not doubting that, I'm just commenting on Varney's comment regarding the issue. The way she addressed the issue (For me, Microsoft is so last century. They are not the problem...) suggests to me that someone at Microsoft put her up to it. Either that, or she is one of the most clueless people the Obama administration has to offer.
Bear in mind, now, that Varney was involved in the US vs. MS case some years ago - as a Netscape lawyer. Although she's worked with Microsoft under more positive circumstances (in the context of her pushing for standards in online privacy), I have trouble seeing her as an MS puppet.
I'm not saying she's perfect, but I think she's one of the good guys.
And... honestly, I agree with her, just a little. Microsoft has become a bloated, nearly ineffective, and arrogant bureaucracy. They may still play dirty, and may still try to strongarm, but their leverage is dwindling as they accumulate resentment from consumers and lose market share.
I'm not saying they're irrelevant; that's obviously not the case. They bear watching, and I sincerely hope Varney isn't as dismissive of them as her quote implies. I think she isn't; she isn't stupid.
Google, on the other hand, is still (usually) playing nice, but has gained incredible influence; the company's name is a household word (literally; the verb "google" is in Merriam-Webster). Any company with that much power bears close scrutiny: a culture shift or a few poor decisions could easily lead to misuse of their dominance.
Re:But... (Score:5, Insightful)
The question being... how could you use a monopoly on advertising to keep other advertising companies from effectively advertising?
Just as microsoft does more than simply sell operating systems, so does google do more than simply sell internet advertising.
For example, Google could rig their search engine to never index any web pages that discuss either yahoo's mapping service (formerly mapquest) or microsoft's mapping service with it is really awesome "bird's eye view" feature.
Thus Google's effective monopoly on internet searches could be used to harm other businesses which rely on internet advertising to pay the bills.
Re:That's scary (Score:3, Insightful)
I'm really not getting what everyone is getting their panties in a twist over.
Let me guess, you read the article didn't you? If so, I think you know the answer to your question.
Re:That's scary (Score:5, Insightful)
Let me guess, you read the article didn't you? If so, I think you know the answer to your question.
LOL. Took me a minute to realize what you meant. But yes, I do think I know the answer now.
I RTFAed, and assumed others did too. I must be new here. ;)
Re:But... (Score:3, Insightful)
Does Microsoft have a monopoly? yes.
Does Microsoft abuse their monopoly staus? frequently
Does Google have a monopoly? yes.
Does Google abuse their monopoly staus? not yet
There's the difference, and there's why they need to be handled differently. MS not only has abused their monopoly status, they actually have a well-established track-record of doing so whenever they think they can get away with it, and not being the least bit apologetic or repentive when they DO get caught.
That's why someone has to keep an eye on Google (and that's OK), and why MS needs to be held captive under the magnifying glass. Lets hope the new guy understands this.
Why do we say Microsoft is abusive, but not Google (Score:3, Insightful)
Where's the fine line between successful strategy and abuse? It seems to be the point at which it becomes popular to hate a company.
Let's look at the sins of which Microsoft has been accused.
If I'm not mistaken, one criticism is that it's taking advantage of having huge stockpiles of money, in order to "dump" its products at low cost into markets to gain control. Well, Google's playing that same game, more successfully. They've put out a ton of software at *no* cost, in order to promote their company. That's taking advantage of a large size, at least. And it's hard to get mad at them for it, because their free products are actually good.
The other act that's coming to mind is bundling - using large share in one market to gain an advantage in another (operating systems and browsers... which don't even seem like that far a stretch from each other, imho). Is this all that different from what Google is doing when Gmail serves up Google's own advertisements? Their tremendous resources let them built a wildly popular webmail product, and which in turn increases the scale of their booming advertising business. Once again, nobody is really bothered by this, because we (seemingly) all use Gmail, willingly.
Despite the lovefest shielding their public image, Google's monopoly surely does have "victims". Even if they don't directly piss off consumers, they must have driven out more then a few competitors from the advertising market. And the ad-supported webmail market. And anything else they've touched.
I've never liked Microsoft, but I've never liked the antitrust claims against them either. Google's actions are awesome, and Microsoft's are evil, and I'm not sure why. I certainly hope there's more to it than the popularity contest.
for christs sake (Score:5, Insightful)
With a presidency that is socialist-leaning and big-government-oriented, it seems we are backsliding into a kind of pre-Reagan era where business is viewed as a necessary evil, the best and brightest should work for the Feds or community organizations, and we shouldn't even try to compete with our ultra-capitalistic competitors in East Asia and elsewhere.
Let me guess where you heard that -- Rush Limbaugh? John McCain? Get a grip on yourself, man; if Obama was "socialist-leaning," how the hell did he get support [opensecrets.org] from Goldman Sachs, Microsoft, Google, Citigroup, Morgan Stanley, and other capitalist corporations? How did he get endorsements [wikipedia.org] from such well-known millionaire capitalists as Warren Buffett, Hilary Rosen, Craig Newmark, David Geffen, etc.? How about Ben Bernanke? Or Brink Lindsey of CATO?? Do you really believe any of these people would endorse a "socialist"??
Re:Monopoly on online advertising is the least of (Score:2, Insightful)
You're a retard. Like the shit-dripping retarded interpretation that "proves" Microsoft is a monopoly, any accusation of Google being a monopoly is just retarded.
Customers have many viable alternatives. If Google was hit by an asteroid tomorrow and went down, "oh shit, guess I better go to www.yahoo.com or any one of the other web search sites". Or "oh shit, I better wait a few days for someone to popup and take their place.
Any "thinking" that labels as a monopoly a company based on intellectual property they created versus a physically limited resource is irrational.
Microsoft vs Google (Score:5, Insightful)
I've never liked Microsoft, but I've never liked the antitrust claims against them either. Google's actions are awesome, and Microsoft's are evil, and I'm not sure why. I certainly hope there's more to it than the popularity contest.
One company leveraged their dominant product directly to push a secondary product that might otherwise have been supplanted in favor of a rival. The other created a product so superior to everything on an already saturated market that they outstipped the competition on sheer technical prowess alone. One company put something free into a product that everyone had to pay for to coexist technologically. The other put their money-making product into a free offering that was among a huge field of other free offerings. Microsoft can subsidize products with their massive revenues, but for them to gain the traction that they do requires that they be incorporated into the one product that many people have to have: their operating system. Google can subsidize their products with their massive advertising revenue, but can't actually tie their products to the purchase of ad space. They still have to rely on technical superiority for adoption. If nobody has a reason to use it (i.e. Chrome), they don't have a customer base that they can foist it off on by unnecessarily tying it to a product many people need. That their advertising revenues benefit from ad placement in their free products attests to the popularity of the product rather than to the tying between it and the advertising. Gmail is a delivery channel for advertising, but had to be compelling in some way to encourage users to voluntarily sign up for the advertising channel over Yahoo! Mail or MS Live (among others in the field).
On first blush, Google and Microsoft can be compared readily. They are dominant in their fields. When you get past that, however, the ways they achieved (and used) their dominance are nearly polar opposites.
I'm not a huge fan of either of them. One is useful but otherwise unremarkable aside from sheer popularity, one is barely tolerated out of necessity. For many people it probably is a knee-jerk popularity contest, but that's to be expected since the vast majority of people have no reason to consider the issue any deeper than what they garner from passing comments and opinions of others.
Re:here we go again.. (Score:4, Insightful)
Wow. I see you have arrived on our planet full of piss and vinegar and ready to support your political heroes full bore. That's great, I'm happy for your new found success.
Oh wait, this is about Obama's new Anti-trust chief going ape on a search engine that happens to have sponsored links clearly separate from the results, and a successful advertising model that doesn't annoy the user. Not the opinions of a 20-something who not only didn't live through the Hoover era, but who also didn't live through the Reagan era, but knows all sorts of incorrect things about them. In fact, said 20-something received all of his/her opinions in something resembling a benediction from high school teachers and *maybe* university professors.
He now reflects those spoon-fed half-baked ideas back onto the world like the ignoramus he is, having never run a real business, having never had to raise a family, or do any real-life task. Fitting that he should support a politician who thinks no one should be doing any of those things.
Split the companies already! (Score:1, Insightful)
I can't for the life of me figure out why companies are so hesitant to split into separate business entities. There can still be close collaboration between them... look at the defense contracting business... contractors from different firms regularly work together on the same project in the same office in cubes adjacent to each other. There's no reason that the IT industry could not do the same to avoid governments calling "monopoly" on them. In the long run, this strategy would help keep us all more honest I think.