USDOJ Sniffing Google Antitrust Suit, Hires Ex-Disney Lawyer

Van Cutter Romney was one of several to write with the story that "The Justice department has secretly hired former Walt Disney lawyer Sanford Litvack for a possible antitrust suit against Google. As reported earlier, the Justice Department is investigating the deal between Google and Yahoo which accounts for 80% of online search advertising. The Wall Street Journal writes today that Justice Department lawyers have been deposing witnesses and issuing document subpoenas for weeks — but that doesn't necessarily mean a case will be brought."

So, lemme get this straight...

1) Google proposes deal with Yahoo.
2) Federal Trade Commission, the government entity charged with regulating business activities vis a vis anti-trust regulations, gives the OK.
3) Google goes through with deal
4) Justice department investigates for anti-trust violations.

Why does this remind me of when the Big Three were getting sued for the type of airbags that the Feds REQUIRED they install, and not having switches to turn them off which they were prohibited from installing by the same regulations?

Re:

You've got it straight.

In many ways, it sucks to try to do business in this country, particularly if your company is big enough to plunder.

-jcr

Re:So, lemme get this straight...

Technically speaking on the air bag issue, the NHTSA required that driver and passenger 2nd generation airbags be mandatory in vehicles made after 1998. There was some specification on the airbags but where the Big Three were getting sued was that their airbags tended to be a bit more aggressive than airbags made by other manufacturers. There airbags did fall under the NHTSA specifications though. I think the Big Three modified their airbags with kill switches and sensors, etc. Also at the time, it was not recommended that children not be seated in the front seat.

So on the Google issue, the deal may have been approved by the FCC, but do we know if any laws were broken outside the deal? Remember, MS wasn't prosecuted for being a monopoly but rather for abusing its monopoly power over rivals and partners.

Re:So, lemme get this straight...

1) Google proposes deal with Yahoo.
2) Federal Trade Commission, the government entity charged with regulating business activities vis a vis anti-trust regulations, gives the OK.
3) Google goes through with deal
4) Justice department investigates for anti-trust violations.

Why does this remind me of when the Big Three were getting sued for the type of airbags that the Feds REQUIRED they install, and not having switches to turn them off which they were prohibited from installing by the same regulations?

Oh, I think it sounds more like Google not paying up to the appropriate parties, now here's the threat of something unfortunate happening to their business. Note that Microsoft got off on the anti-trust charges after the bushies came in.

Re:So, lemme get this straight...

This whole thing sounds like something out of an Ayn Rand book.

When do we get the Equalization of Opportunity Bill?

Wierd theory here

Could it be that other are having trouble competing with Google because everyone else has lost touch with their user base but google? The only reason I use google search is because how fast it loads, their main page isnt bogged down with crap that takes time to load, it just loads. If one of the big three had been smart enough to know that the hard core among us just want efficiency and we are the ones that provide word of mouth then they would be a lot better of. Google doesn't prevent competition, it just does things better then the competition.

Re:Wierd theory here

Let's not forget that there's no more open and free market than the internet. I can load up cuil and use it all day long if I want to, and any website can go to any ad service they want to. As a matter of fact, you'd have to go to MSN to get an ad into Facebook. There are so many ways to compete on the internet and they cost next to nothing. Now, if Google starts offering discounts for people who only use adwords, then there might be an issue. However, as far as I've been able to tell, they don't, so what's the problem?

Google's ahead because they're better

Google became the dominant search engine for a couple of reasons - not only is it really fast and uncluttered, compared to some of its early competitors (remember Hotbot?), but PageRank did a good job of guessing what pages would be the most relevant and most interesting and displaying them first, and nobody's really caught up with them. On the other hand, they've still only got a bit more than 50% of the market - their two main competitors are staying in business.

In advertising, which is how Google makes most of their money, Google ads are uncluttered and fast, so they're not as annoying as other ads, making web site authors more willing to carry them, and apparently advertisers think Google does a good enough job of targeting ads to readers that they're more effective than their competitors or have a better price per result or something.

And unlike Microsoft, where the tight integration between the OS, device drivers, the mail system, the calendar, and Office makes it difficult to leave once you're addicted, it's easy for anybody to use another search engine instead of Google, or for an advertiser to use a different ad agency, and the reason Google stays on top is because they invest enough development money to keep their quality high.

This will mean nothing in the end

FTFA:

a federal antitrust case against Google could set new boundaries for Internet competition, much as the Justice Department suit against Microsoft Corp. a decade ago broke ground applying antitrust law to new technologies

Yes, and we all know how much that decade-old antitrust suit changed the world...

Re:This will mean nothing in the end

Actually, it changed the world a lot.. The world used to believe that the US actually had shreds of decency and fairness left in its legal system, and hoped that perhaps the people had a say in their Government, rather than it being owned by the Corporates.

I don't understand antitrust suits

I get the part that Google is monopolizing the online advertising space. But that is no reason to sue them. It's true that they set a high bar for entry into the market and they will continue to do so as long as customers flock to them.

The only reason for an antitrust suit would be when the company stifles innovation. But if it does customers will automatically move away from them and move to others who have better services. That's simple economics. DOJ doesn't help the process in any way by suing Google.

Re:I don't understand antitrust suits

The only reason for an antitrust suit would be when the company stifles innovation.

You seem to be confusing "innovation" with "competition." They're not the same, and one does not imply the other.

Re:

Google, like Microsoft before it (and so forth to before my time) stifles innovation today simply through its existence. It does not require active malice to do harm. Anyone involved in the startup world will tell you that one of the major questions VC's will push you on is how you are Google-proof. I mean, they give away blogging, mapping, email, news, search, 3d visualization, online doc collaboration, etc, etc.

If you want to start a business today, you have to have some idea why Google won't just Beta

Inevitable

This was inevitable. Eventually, Google was going to take some steps forward in some area, and somebody was going to panic that it was a "monopolistic" move. Any sufficiently huge company has to deal with that (even Disney had that problem years ago). It will be interesting how it plays out, however. Antitrust suits usually hinge on making sure that the customer is not ripped off. In this case, the customer is not the end-user who surfs the web. The customer is actually the advertiser, since that is where these guys make their money. And the advertisers can still advertise on both Google and Yahoo equally and increase visitor coverage, so it will be hard to prove that the customer has suffered damages.

Lost touch with user base?

Yea, Google has a stranglehold on Internet search and therefore is in touch with their user base.

MS on the other hand has a stranglehold on the desktop OS and therefore is an evil monopoly.

Let's face it folks here's the only difference:
* Google's monopoly will hurt businesses wanting to buy web ads.
* Microsoft's monopoly will hurt individuals who use desktop products.

It just depends on whether you are a business or an individual as to which monopoly you'll feel stung by.

Re:

Please do not confuse market share with monopoly. Microsoft has the majority of the market share of the desktop world. But that is not what makes them a monopoly. Where they can be deemed a monopoly is using their position of dominance to suffocate other competitors, such as forcing computer manufacturers to install only Microsoft Office products under the threat that if they don't comply that Microsoft will yank their Windows licenses. And of course any desktop manufacturer that can't include Windows ca

yeah, ok.

How about they fix the M$ problem first? How many companies were destroyed before Linux got a foothold back in the late 90's?

Hmmmm.

It is NO co-incidence that Microsoft is one of hte top corporate donors to the Republican party. They scratch each others backs regularly.
I am absolutely not a fan of MS, but you must know something that others do not. [opensecrets.org]

What the hell?

Since when does "providing customer with a good product" equate with a monopoly?

Does that mean that if I am TOO successful in the creation and marketing of my product, I have opened myself up to reprimand/repercussions from the government? Someone help me out here. I simply don't get it.

If I make something far superior to my nearest competitor, and the entire customer base switches to my product, I've done something wrong?

Can someone please explain why this is even an issue for Google?

Re:I thought Google is competing with Microsoft

Is it just me, or does everything in the US start with secret allegations that are insane, completely disproven before they're even made public, and yet still acted upon fiercly only to suffer humilation in the end?

Be it military, with imminent threats of destruction from a nation that has no way to harm anyone but themselves, yet turning a blind eye to nations that could (Iraq vs. North Korea for example?)... or be it corporate, where anti-trust is thrown around at google, yet there isn't anything substantial while other companies like microsoft are clearly doing it and are ignored.

It's an upsetting pattern to watch unfold.

Re:

Americaaaa!! Fuck Yeah!

Re:I thought Google is competing with Microsoft

My first reaction was that this has Microsoft written all over it (being that Yahoo refused to sell itself to them).

Microsoft learned a lesson about the DOJ when it went toe-to-toe with it: it's a tool to be used like any other.

Re:

Although one could argue that releasing products for free was akin to underselling the competition, driving other companies out of business by funding these products with alternate revenue streams. Not my opinion, but I can see where they are coming from.

I'm also getting the feeling that this is nothing more than a probe. I guess time will tell on that one.

Re:Big difference

They're making it difficult for mediocre companies to compete, damn it! In fact, the Fed should step in and use tax dollars to help those companies compete. Or use legislation to make Google less competitive.

You jest, but this is essentially what happened to Alcoa back in the day - they were hit with an antitrust suit because they kept making aluminum more efficiently than anyone else and lowering their prices.

Note that the similarities end there. There are strategic reasons to not want a single source for a critical material. There are no such strategic reasons relating to Google. That I can think of.

Re:They didn't hire him.

A Mickey Mouse case if ever I heard of one.

Or at least a Goofy one.