Just After EU Goes After Google For Antitrust, Microsoft Agrees To Drop All Antitrust Complaints About Google

from the interesting... dept

Back in 2011, Microsoft officially filed an antitrust complaint against Google in the EU. At the time, we noted how silly this was, given that the company itself had spent years battling EU antitrust regulations. It almost felt like a "well, if we had to go through that hellish process, let's put it on Google too..." kind of thing. Within less than a year, Google filed its own antitrust complaint back against Microsoft. As we noted at the time, both claims seemed kind of ridiculous and overblown -- and it bothered us greatly that these companies were resorting to stupid political games, rather than just competing in the market.

So, now, just days after the EU officially took that ball and ran with it, Microsoft and Google have announced that they've buried the hatchet and agreed to drop all antitrust complaints against each other around the globe. They insist this has nothing to do with the EU's move earlier this week. In fact, the writing has been on the wall for some time here. The two companies had ended the patent battle last fall, with everyone dropping all complaints and lawsuits. And, just a couple of months ago there were reports that Microsoft was cutting back on supporting the very coalitions that it had put together and funded: ICOMP and FairSearch.

It had always been obvious and well-known that both groups were Microsoft front groups, and now it's official... and over. According to Re/code:

“Microsoft has agreed to withdraw its regulatory complaints against Google, reflecting our changing legal priorities,” a Microsoft representative said in a statement to Re/code. “We will continue to focus on competing vigorously for business and for customers.”

Google, meanwhile, offered up a similar statement, affirming that it too will withdraw any regulatory complaints it has made. “Our companies compete vigorously, but we want to do so on the merits of our products, not in legal proceedings.”

Of course they could have, and should have, done that five years ago, rather than going through this wasteful process for all involved. The Re/code report suggests a big reason for the shift is the new leadership atop both Google and Microsoft, leading to less animosity and a willingness to work together in some areas and compete directly in the market. It was disappointing that the two ever bothered to focus on trying to dump bureaucratic nightmares on each other in the first place, so it's good that that part is over. However, the antitrust investigations and potential outcomes won't stop just because the companies have stopped supporting them. Once those launched, they'll keep on going.

Filed Under: antitrust, bureaucracy, competition, eu, innovation, truce
Companies: fairsearch, google, icomp, microsoft

Google Competitors Spitting Mad About FTC Closing Case; Promise That Europe & Texas Will Get It Right

from the we'll-see-about-that dept

With the FTC closing its antitrust case against Google, the group of Google's competitors who were the main instigators behind the effort aren't giving up easily. Gary Reback, the lawyer whose entire persona is wrapped up in being "the lawyer who gets the FTC to attack big companies" (he also led the charge against Microsoft a decade and a half ago) issued an incredibly combative statement:

“I've been doing this almost 40 years, and I've done dozens if not scores of government investigations on both sides, and I have never seen a more unprofessional, incomplete, incompetent investigation,” said Gary Reback, a Silicon Valley lawyer who represented some of Google's complainants before the FTC.

Really, now? In the briefing the FTC gave about the situation, FTC boss, Jon Liebowitz, indicated that the Google competitors' strategy of attacking the FTC when it was suggested that there might not be enough evidence for antitrust didn't help convince the FTC to suddenly create evidence out of thin air. Apparently, Reback would prefer that the FTC do stuff just because he says so, even as the evidence for Reback's claims are completely lacking.

Meanwhile, the laughably named "FairSearch" group -- a collection of Google competitors, who teamed up to create a publicity campaign solely with the goal of attacking Google over antitrust claims, came out with its own hilarious statement, which could be summarized as "it's not over yet! There's still Europe! And Texas!"

“The FTC's decision to close its investigation with only voluntary commitments from Google is disappointing and premature, coming just weeks before the company is expected to make a formal and detailed proposal to resolve the four abuses of dominance identified by the European Commission, first among them biased display of its own properties in search results.

The FTC’s settlement is by no means the last word in this case, leaving the FTC without a major role in the final resolution to the investigations of Google's anti-competitive practices by state attorneys general and the European Commission. The FTC’s inaction on the core question of search bias will only embolden Google to act more aggressively to misuse its monopoly power to harm other innovators.

State attorneys general who reportedly disagreed with today's announcement by the FTC have an important role to play in ensuring both that Google is not allowed to continue practices that hurt every American business through artificially high advertising costs, and to demand that whatever changes Google is forced to make in Europe also apply for U.S. consumers who risk losing innovation because of Google's aggressive abuse of its dominance.

It is true that the EU Commission is still doing its own investigation, and given the EU's general feelings that "big" (and "American") must somehow be "bad," it's likely that they'll come down a bit more harshly on Google, as they did on Microsoft. Similarly, some state Attorneys General (mainly Texas) who have been grandstanding against Google and other tech companies for years will likely grouse about this -- but their ability to do anything about it may be fairly limited, given the lack of any actual evidence of harm.

In the end, this is coming off as even more sour grapes from companies who chose to focus on whining to government, rather than competing in the marketplace. In the future, instead of spending so much on lobbyists and lawyers, perhaps they could focus on building better products that the market wants.

Filed Under: antitrust, attorneys general, competition, eu commission, ftc, gary reback, texas
Companies: fairsearch, google

How Quickly We Forget: Google's Competitors Falsely Claim Google Dominates Because It Was 'First'

from the history-lesson dept

Well, the second part of the Senate's anti-Google hearings have wrapped up, and like the first part, they seemed pretty misguided. It was a lot of repeating things about how Google is big. There were some reasonable points that do bear more scrutiny, concerning some of Google's business dealings with partners, but, on the whole, people seemed to be making a big deal out of nothing.

For example, one Senator continually quizzed WSGR lawyer Susan Creighton over whether or not Google "scraped" content. Creighton seemed to stumble over the question, but the proper answer is of course it does, because that's how search engines work. Yelp's CEO Jeremy Stoppelman complained about Google taking the same content it indexed for search, and then using it elsewhere. But no one mentioned the basic concept of fair use. If it's a problem for Google to scrape and use content -- as was implied repeatedly in the hearing -- doesn't that make any search engine illegal?

But, the most ridiculous testimony came from Thomas Barnett, a lawyer for Covington & Burling, who was representing a bunch of Google competitors who put together an operation called FairSearch. When asked about whether or not Google was a monopoly player, Barnett flat out lied, claiming that Google is dominant and can't be unseated "because it got there first."

Woah!

I know they say that the history books are written by the winners, but this seems like a case where the history books are being revised by the losers. Anyone who was actually paying attention when Google came on the scene thought Google was a joke. The search engine market was locked up and there was no room for competition. We had Altavista, Lycos, Inktomi, Excite and a few others as well. People thought Google was a crazy idea. Who would possibly enter the search market -- especially since Yahoo really seemed to have the market wrapped up (without its own search engine, but partnering with Altavista and Inktomi, before later partnering with Google)? It was a dead business.

Google wasn't first. It was seriously late to the party.

And that's really the point that's important here. Markets that look locked up in the tech/internet world very rarely stay locked up for long. Five years ago, MySpace absolutely dominated the social networking space. Where are they today? Ten years ago, Yahoo was the dominant destination site. Fifteen years ago AOL was how people got on the internet. Fifteen years ago, Netscape was how you surfed the web. All of these players were dominant with huge market share. How are they all doing today? Which one needed government regulation to break their hold on the market? Things change. Markets change. Rewriting history and bitching about Google because it's big misses the point. If Google does bad things, there are hundreds of entrepreneurs out there just waiting to take parts of the market away from the company.

Filed Under: antitrust, competition, innovation, search
Companies: altavista, excite, fairsearch, google, inktomi, lycos, yahoo

Expedia Against 'Search Discrimination'... Unless It Gets To Do The Discriminating

from the hello-hypocrites dept

You may have heard about the "controversy" over the last few weeks, concerning American Airlines' decision to pull out of Orbitz, the online travel booking site (we covered how American Airlines has wanted to do this for years, and was finally allowed to go through with it). Almost immediately after that happened, Orbitz competitor Expedia apparently decided to "punish" American Airlines by first hiding AA results in Expedia's own search and then dropping AA altogether. While this kind of "solidarity" with a competitor might raise some collusion questions, an even bigger issue is that it lays out Expedia's blatant hypocrisy on the question of "search discrimination."

That's because Expedia is a leading member of a lobbying group called FairSearch, which was set up mainly to protest Google's planned acquisition of ITA. Both sides on that fight have been bombarding me with press releases/articles on a near daily basis, all of which I've ignored, because it's a silly fight. However, considering that Expedia is one of the main members of the group, and one of the key points that the group is supposedly fighting for is protesting "search discrimination," the whole thing rings a little hypocritical. From the FairSearch website:

TRANSPARENCY: Consumers -- not search engines -- should choose winners in the marketplace. Consumers benefit from more choices in the search marketplace competing to win users, innovating to improve products and displaying results transparently. When search providers engage in search discrimination -- manipulating search results to promote a favored product and punish competitors -- consumers pay the price.

This comes just one paragraph above a nice Expedia logo: Yup. So, just as Expedia, in an attempt to complain about Google, claims it's against search providers discriminating by manipulating results to promote or punish certain players, it's doing so in a way that's significantly more noticeable than anything Google is doing. I agree with Eric Goldman that Expedia should be able to set up its search engine however it wants, even if it means making life worse off for customers by hiding certain results purely as retaliation to a company it doesn't like. There's choice in the marketplace, and this move means that I'm much less likely to use Expedia. But to complain about this exact form of discrimination, while doing it in a way that's much more noticeable than the one you're complaining about? That's pure, unadulterated hypocrisy. Way to go Expedia.

All that said, I'm a bit confused about this entire dispute. What's to stop Orbitz from simply getting American Airlines fares from wherever it wants to get them and including them? The data is factual data, not subject to American Airlines' control, so I don't even see how AA can legally stop Orbitz from including it. The real issue, it seems, is that AA wants Orbitz and others to get their data directly, rather than via middlemen, but the way to do that is to make it easy for the travel search engines to do that in a way that's more convenient and cheaper than getting it through any middlemen. Not sure why that requires a legal dispute...

Filed Under: search discrimination, travel
Companies: american airlines, expedia, fairsearch