In Antitrust Probe, Google's Critics Have it Wrong

Much of what motivates supporters of an investigation of Google at the Federal Trade Commission is not a genuine desire to protect consumers, but a desire to protect competitors from Google's intense competitive nature.
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It's about the consumer, stupid.

The proponents of an antitrust investigation of Google suggest Google is inhibiting competition by setting up barriers harming consumers. But a close examination of Google's entry into multiple consumer markets illustrates the opposite -- that where Google competes, consumers benefit. In fact, what many supporters of an antitrust investigation of Google do is to intentionally conflate the interests of consumers with the interests of competitors of Google. They are indeed distinct and separate; mistakenly intertwining the two to justify an investigation of Google is a fundamental twisting of facts and a misuse of longstanding antitrust law.

Google has never tended to destroy competition. In fact, in most of the markets it has entered, it has stimulated competition, reenergized markets and created more consumer choice, not less.

Witness: search. When Google entered it, Yahoo! was sitting on a big lead as the incumbent. Google had built a better mousetrap, and within a year, built its leadership in the marketplace through providing a better product. It is important to remember how Google did this -- through a search interface that was easier to use and more accurate. Google critics conveniently jump directly to the present time, saying the company uses the massive scale of searches it processes to protect its lead, while ignoring how Google achieved popularity in the first place.

Additionally, consumers have the ability to walk away from Google at any time. Google's own browser and mobile operating system allow consumers to change the default search engine to either Yahoo! or Bing at any time. This is hardly the kind of "lock in" that would bar consumer choice that antitrust law is designed to deal with. The competition is just a click away.

Look at online maps. MapQuest dominated this market when Google jumped in with its Google Maps product. Anyone would be hard pressed to find a commentator who doesn't prefer the features and flexibility of the Google product to the former market leader.

Google hardly owns every market it enters. But even when they are a runner up, they often improve the consumer experience, even with competitor products. Microsoft and Yahoo! ruled the online email market as late as 2007. Today, by providing a better user experience, Gmail has nearly achieved a tie with Windows Live Mail, according to Experian Hitwise. Many of its features have been introduced by competitors, and as a result, it has stimulated a healthy market for consumers across the board.

Products like Buzz, which were a flop on introduction, also have the benefit of keeping the dominant player in the social networking world, Facebook, on its toes and continuing to innovate. A world without Google would allow Facebook to remain dominant and unchallenged by any significant competitor in the social space.

Google has also introduced products that have challenged some of the big players in the offline world, as well. Google Voice will never supplant cell phone service providers. But by providing free voice service and text messaging to cell phone users, Google spurred competition in the mobile market and keeps a check on price increases by the incumbents. Much of what motivates supporters of an investigation of Google at the Federal Trade Commission (FTC) is not a genuine desire to protect consumers, but a desire to protect competitors from Google's intense competitive nature. However, it is critical to remember why antitrust laws were written in the first place.

They weren't designed to ensure companies like Foundem, a search comparison site, is guaranteed a high placement in Google search results. They weren't written to guarantee that Microsoft's Bing can achieve a higher market share among search engines, either.

According to the Supreme Court, antitrust laws exist not for the benefit of corporations, but for the aid of consumers. In one case, Spectrum Sports, Inc. v. McQuillan, the court stated this point clearly and powerfully:

"The purpose of the [Sherman] Act is not to protect businesses from the working of the market; it is to protect the public from the failure of the market. The law directs itself not against conduct which is competitive, even severely so, but against conduct which unfairly tends to destroy competition itself."

The Federal Trade Commission has jurisdiction to investigate anti-competitive conduct in broad sectors of the economy, including the technology sector. But an antitrust investigation of Google, prompted by complaints that have more to do with the needs of competitors than with the best interests of consumers, is out of touch with the commission's purpose of protecting consumers.

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