Inside the U.S. Antitrust Probe of Google (paywall – to get to it use this search result to get through) is a look by the Wall Street Journal at the FTC staff report inadvertently released to them under a FOIA request. The staff findings “concluded that Google’s conduct has resulted—and will result—in real harm to consumers and to innovation in the online search and advertising markets.”
That is a stark contrast to the final early 2013 ruling by the FTC that put an end to the investigation
I have long been a skeptic of antitrust cases and decisions that take place in our “democracy”. It is a democracy predicated on the one dollar one vote ideal of modern capitalism. The process is typically started by self interested companies that often gang up against a bigger self interested entity. This was no exception. However some of the findings divulged in the report were of interest.
“Data included in the report suggest Google was more dominant in the U.S. Internet search market than was widely believed. The company estimated its market share at between 69% and 84% during a period when research firm comScore put it at 65%. “
Many of us in local have long held that Google’s share particularly in Local was in the 85% range. It may even be higher now.
“It cited one instance when Google copied Amazon’s sales rankings to rank its own items.”
It is my belief that Google is still doing that albeit in local. Particularly with the Local One Pack in secondary markets where there is a dearth of user data.
“The report said Google ‘adopted a strategy of demoting, or refusing to display, links to certain vertical websites in highly commercial categories.'”
OK, so what else is new? Oh there is something new. Google is now doing the same thing with individual small business websites with the new Local Stack results. The page is dominated by either ads or the stack itself which leads back to Google. And in some cases it leads to 100% monetization above the fold.
The revelations confirm for me the way things actually work. These cases are not brought on behalf of consumers (although there may be some tangental consumer benefit in a decision against Google) and the outcomes are dictated by realities other than their well being.
The whole thing reminds me of the version of the Farmer in the Dell where the Farmer hits the wife. The consumer is the cheese.
There are no heroes here. Yelp? No way, they are just further down stream. And beat up SMBs.
Likewise there are no devils. Is Google evil? No way. They are protecting their interests. The FTC? Likewise.
But there is a lesson as we get to see how our regulatory sausage is made. The mythology of our childhoods, that government in our society is elected by us to protect our (the citizen’s) interest, is not how it actually works.
Let’s leave the mythology behind as we discuss stark reality of how our world operates.