Has Google Become Too Powerful?
Google has been playing dirty.
The Internet search (and soon to be everything else) behemoth has been caught flexing its muscles a little too broadly, according to documents from the Federal Trade Commission. The FTC claims that the company abused its monopoly powers, and as a result, both consumers and Google’s competitors suffered harm. This all comes from documents that were produced as far back as 2012, but have only now been made public by The Wall Street Journal.
So why are you only hearing about this now? Because, at the time, the FTC decided that it wouldn’t seek legal action against the company. It’s also come under fire in Europe as well.
To get into the specifics, Google was found by an FTC probe to have used anti-competitive business tactics, including the taking of content from companies like Yelp, TripAdvisor, and Amazon, which ultimately put Google at an advantage. Essentially, by taking the content from those sites and displaying them to users in search results — like hotel prices, flight listings, etc. — consumers are then less likely to visit the sites that actually produce those results, and instead use Google to pursue transactions.
At the heart of the matter is the fact that Google is so mammoth in size and scope that almost everything on the Internet can be captured by its results page. That, regulators say, is what gives Google monopolistic powers in the search industry. And they’re right in that aspect — traffic rankings from EBizMBA show that Google is by far and away the world’s largest search engine, nearly four times as much traffic as its next closest competitors, Bing and Yahoo.
During the FTC probe, which apparently lasted more than two years in duration, the federal watchdogs did indeed find evidence that Google had been engaging in shady practices. Again, however, the FTC decided not to pursue legal action.
It looks as though Google may not get out of this whole mess scot-free, despite the fact that the FTC was willing to let them walk away a few years ago. It’s also important to keep in mind that Google didn’t get away from European regulators, some of which actually called for the company to be broken up into smaller companies so as to destroy its monopoly power.
In the U.S., the Wall Street Journal is reporting, in a follow up to its initial revealing article, that there is still plenty of noise being made by Google’s competitors about its business tactics. That clamoring may lead to more probing by the FTC, and possibly lawsuits.
So, what does Google have to say about everything? So far, the WSJ says that the company’s leadership is content with the story that their service is simply to provide search results to consumers, and not to promote websites for individual companies wishing to capture search traffic — unless, of course, it’s part of a search advertising campaign.
At its core, the issue that Google is facing is that there are companies upset that Google is giving its own services preference over others. That’s not entirely surprising, but given how large and monopolistic the company is in the search industry, evidently regulators and competitors feel that it’s simply not a fair fight.
Case in point, Google has allegedly been burying the news of its anti-competitive practices in search results. Again, not surprising, but perhaps a bit shady.
But what really has some people upset isn’t only that the FTC was willing to let Google slide by with some obvious transgressions, but the apparent motivation behind that decision. In fact, The Guardian reports that the FTC never meant for the original documents — those that sparked the initial Wall Street Journal report — to be seen by the public in the first place. It does seem to hint that there is a bit of a cushy relationship between Google and the FTC.
The Guardian also mentions the blog Google Monitor, a watchdog site, which says that the FTC’s actions in shielding Google were politically motivated. “Public evidence concerning the sequence of events surrounding the FTC’s closure of its Google search practices investigation creates at least the appearance that politics, and not merits, drove the FTC’s ultimate conclusion,” Scott Cleland of Google Monitor writes.
Now that the world knows, it’ll be interesting to see if Google can continue to get away with what it’s been doing, or if regulators will face public pressure to bring down the hammer. European lawmakers have shown they’re willing to throw down. The question is: Are America’s?
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