Google Antitrust: the FTC Folds
posted by Frank Pasquale
Both Eric Goldman and James Grimmelmann have the details on the FTC’s rather extraordinary capitulation today. It is a big win for Google. Still, a few questions remain. I have the following:
1) Commissioner Rosch included this intriguing footnote in his concurrence/dissent:
I . . . have concerns that insofar as Google has monopoly or near-monopoly power in the search advertising market and this power is due in whole or in part to its power over searches generally, nothing in this “settlement” prevents Google from telling “half-truths”–for example, that its gathering of information about the characteristics of a consumer is done solely for the consumer’s benefit, instead of also to maintain a monopoly or near-monopoly position. . . .That is a genuine cause for “strong concern.”
Did Google ever say that it was gathering data purely for consumers’ benefit? That would seem to be an odd representation for a for-profit company to make.
2) The FTC’s letter closing the investigation has given us precious little illumination here, and makes the entire affair seem like a waste of enforcement resources (or a fiasco to be expected from an agency utterly outmatched by the entities it is investigating). The Commission’s statement says “The totality of the evidence indicates that, in the main, Google adopted [changes] improve the quality of its search results, and that any negative impact on actual or potential competitors was incidental to that purpose.” But it has not released details about the nature of that evidence, the types of tests it used, or the standards employed in them. How are other tech companies to avoid such investigations in the future if they can’t get such information?
3) In its “commitment letter” to the FTC, Google states that it won’t demote sites in general purpose search results (on Google.com) if the sites opt out of having their content scraped onto Google Shopping, G+ Local, Flights, Hotels, and Advisor webpages. As the FTC Chairman put it,
Going forward, Google will allow websites the ability to opt out of appearing in its vertical properties like Google Local or Product Shopping, without being penalized or demoted in its general search results on Google.com.
What happens if a site produces evidence that it has been demoted after opt-out (during the 5-year period this commitment letter is good for)? Is there any FTC process that will be faster, more accurate, or more streamlined than, say, a good old-fashioned adjudication? If not, isn’t a commitment like this superfluous?
4) The New York Times reported in October that the FTC staff had prepared a secret 100-page memo advocating legal action against Google. Did the staff change its mind completely in less than 90 days? Or have they been overruled by political appointees? Peter Maass has noted, in the privacy context, that “The agency can take companies to court, but its overworked lawyers don’t really have the time to go the distance against the bottomless legal staffs in Silicon Valley.” Is the same now true for competition law as well?
To be sure, Google hired some of the best minds in the legal profession (and academy) to promote its position. That kind of advocacy often gets results. But until we have a better sense of the answers to the questions above, I’m afraid the bottom line is that a black box investigation exonerated a black box search engine—cold comfort for those who might worry about the power exercised by Google online.
X-Posted: Madisonian.
January 3, 2013 at 9:51 pm
Posted in: Antitrust, Consumer Protection Law, Google & Search Engines, Technology
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Responses (6)
Brett Bellmore - January 5, 2013 at 8:42 am
The real problem with Google isn’t not letting people opt out of being included in google shopping results. It’s the exact opposite: Google’s increasing tendency to remove valid shopping results for legal products, based on politically correct criteria. Potentially you could get excluded from the results based on evidence that your politics were something they didn’t like.
Facebook is currently being accused of political censorship of accounts. Suppose google starts excluding from shopping results any business they conclude is run by conservatives?
Really, they’ve just got too much power, and too much willingness to use it for purposes utterly irrelevant to profit making.
Shag from Brookline - January 5, 2013 at 9:38 am
Google is a corporation. Corporations are people. Should we limit Google’s First Amendment rights per Citizens United? Can Brett provide examples of:
” … and too much willingness to use it for purposes utterly irrelevant to profit making.”
Query: Has Brett made the same complaint about Fox which has gone on for many more years than Google has been around? (Recall Fox owner Murdoch’s recently disclosed efforts to promote Gen. Petraeus for the GOP nomination for 2012.)
Or is Brett a late-coming trustbuster?
Brett Bellmore - January 5, 2013 at 11:59 am
I Shag’s world identifying a problem, and demanding a legal intervention, are one and the same. Not in mine.
Shag from Brookline - January 5, 2013 at 2:56 pm
Who’s ” … demanding a legal intervention …”?
Brett Bellmore - January 5, 2013 at 6:00 pm
“Should we limit Google’s First Amendment rights per Citizens United?”
Were you proposing to do so via illegal intervention?
Shag from Brookline - January 5, 2013 at 9:00 pm
I did not propose to do any intervention, legal or illegal. Brett, the haystack in this thread is quite threadbare so search for that needle that in any way indicates a demand or proposal by me for a legal, illegal or any other kind of intervention. I have too much fun Googling “Brett Bellmore + [insert appropriate phrase]” from time to time to limit what Google offers for free, sort of an Internet “liberty.”
In fact, Brett, it was you who said about Google “Really, they’ve just got too much power, … ” which suggested that this was upsetting to you, as Google might use such power in some political fashion that you might disagree with. That’s why I asked if you, a professed libertarian, were leaning to trustbusting.
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