Google is a monopoly. Now what?
Google was officially declared a monopoly by Judge Amit Mehta.
The judge found that, 'Google is a monopolist, and it has acted as one to maintain its monopoly. It has violated Section 2 of the Sherman Act.'
The court found that Google has a monopoly for general search and general search text ads.
It also found that the distribution agreements were exclusive and had an anticompetitive effect. And, finally, Google used its monopoly to charge supracompetitive prices for the text ads.
Reading the document was very interesting, but I found this the most poetic part of it.
Judge Amit Mehta was pleased with the conduct of all the parties — 'The lawyering has been first rate throughout.' It is nice to see that even when two parties disagree, they can still act in a professional and civilized manner. It pleased the court.
What's next? That's a great question!
Last year, yours truly wrote a post about Google on trial where I questioned if DoJ has a case. Well, I was wrong. The judge found that the DoJ had a case. Now, the DoJ has a much harder task ahead. What would be the remedy to ask the judge to consider? What would you do?
Here are few options:
Tell Google not to be a monopoly.
Forbid Google to pay Apple, Samsung (and other Android phone makers), Firefox for exclusive placement of its products?
Force Apple, Samsung, Firefox to provide a choice when it comes to a search.
Break up Google.
I guess the first option is not going to work. The second one would mean that Apple and others will lose billions of dollars in revenue.
Or could these companies, for good measure, ask Bing to give them more billions to be an alternative?
Great. From monopoly to duopoly. Your initial reaction to this statement might be: 'But wait, there are other search engines on the market.' You are correct. There is Yahoo!, AOL, DuckDuckGo, Ecosia, MSN, Lycos, Search.com or ClassifiedAds.com. The only thing is that they are all using Bing as their backend ...
Yes, you might find local search engines for individual countries — Yandex, Seznam or Qwant. I think that also nicely summarizes the third option. Even if all these companies provide options for you to choose, let me know which one you will go with.
Perhaps some of you might suggest that we now have a new crop of search engines, the ones which are affectionately called 'AI search engines.' The issue is that none of them are production ready. They are in early stages of development and experimentation. Not ready for prime time. True, an exposure in the menu to choose from will provide a boost in traffic and help them to build better products, but these startups still need billions to build up the infrastructure and tech.
That leaves us with the fourth option — the break up. The biggest question, then, is which pieces do you separate? One option is that you will have Google’s parent company, Alphabet, broken into A-J, another K-Q and then R-Z. I read that DoJ is thinking about forcing Google to divest Chrome (the Google browser) and Android (the phone operating system). Does that solve the problem? Will that create an opportunity for others to take advantage of?
Anything else?
Here is another thing. Yelp, the place where people write their sad stories about visiting restaurants, just filed a lawsuit against Google. Yelp is trying to piggyback on the monopolistic ruling against Google. It claims that the local search results, which would favor Yelp, were hidden from users, and, instead, Google shows the results directly on the search result page. Yelp contends that because of that it is losing a sizable amount of ad revenue.
Perhaps that might be another remedy to consider. The search results should link directly back to the websites with no additional information on the search page. Like it was when Google started. I am sure that similar remedies will be sought by airlines, hotels, car companies, news media ... everyone? And that's the thing. For all these results displayed directly on the front page of Google, it creates such a convenient way to find the result. Results, which, of course, can be manipulated or sold to the highest bidder. Even now, you have the choice to accept the results as they are or go and visit every possible link.
I know, all the results there without additional work are so convenient.
I have no idea what the DoJ will choose as the desired remedy, and, of course, what the judge will agree to. I think it is fairly certain that Google will appeal, and this whole thing will go for years.
In the meantime, Google might change how it does things. Technology will change. But, in the end, any remedies will be illusory.
Trying to fix this monolith will lead to nowhere. All the big companies can't change because their business model doesn't allow them. If you punish them with fines, it will become a cost of doing business. If you break them up in hopes that it will somehow allow more competition and innovation, it will only siphon away customers.
What else will happen? The world will move on. The search as we know it today will change. Last year, I wrote about personal web, a space which will be your own, with your own search engine, customized just for you. You’ll also have personalized news and your own store. That's where innovation will happen. That's the new pattern forming, as I see it.