Business | Analysis

Is Google a monopoly? That’s the wrong question

The legal issues surrounding today’s technological ecosystems are far from clear

  • Bloomberg
  • Published: 00:00 July 10, 2012
  • Gulf News

Participants at the Google I/O conference in San Francisco
  • Image Credit: Bloomberg
  • Participants at the Google I/O conference in San Francisco on Thursday. The company is facing a probe on whether it intends to license technology under patents that help operate 3G wireless, Wi-Fi and video streaming on fair and reasonable terms.

Google responded last week to European antitrust regulators investigating a long list of claims against the world's largest search engine. Whether or not the complaints against Google are valid, they may be looking backward. Increasingly, Google is not a search engine.

Yes, Google accounts for 80 per cent of all Web searches in Europe. It is facing criticism (some of it prompted by Microsoft) for favouritism toward Google's own specialty search products — travel, finance, hotels, restaurants, maps — that may put its competitors at a disadvantage. In the US, the Federal Trade Commission has also been investigating Google for the past year.

As pressure mounts on Google to change its practices, it's not clear whether antitrust regulators are asking the right questions. Although European Commission authorities are focused on Google's familiar Web pages of blue links, and the prominence of Google products on those pages, Google seems to be heading in a different direction. It wants to be whispering to individual users by way of its Google devices.

Whether competition law has anything to say about this is an open question. Do we require Chevrolet to allow all car-radio manufacturers to install their devices in its vehicles? (No, we don't.)

 

Perfect search

In November 2009, Google's vice-president of search products and user experience, Marissa Mayer, described the perfect search engine: "It would be one that could understand speech, questions, phrases, what entities you're talking about, concepts. It would be able to search all of the world's information, [find] different ideas and concepts, and bring them back to you in a presentation that was really informative and coherent."

Two years later, Apple introduced its voice-recognition software, Siri, for the iPhone. It seemed to fit that job description. Except for one detail: Siri is inaccurate almost a third of the time.

Last month Google made a series of intriguing announcements signalling that deeply contextualised, personalised information services aimed right at Siri will be rolled out this month in an update to Android phones. Users won't have to ask specific questions because their device will already know where they are — and even what their calendar says they're doing.

Google Now will display transportation information, weather, sports scores, restaurant locations and presumably any other contextually relevant information. A soothing Siri-like voice will answer a murmured query if Google Now hasn't already figured out the user's needs.

Just as the term "horseless carriage" was overtaken by "automobile", "search engine" will soon sound primitive to our 21st-century ears. Instead, you will have a digital deputy that travels with you and is simpler to use and tailored to your wants and needs.

Because Android phones already command more than 50 percent of the US market for handheld devices, all Google has to do is hang on to its Android customers in order to have the scale and scope it needs to be successful.

If its pilot fiber optic installation in Kansas City, Kansas, and Kansas City, Missouri, works and can be replicated, Google can also avoid dependence on any wireless carrier: Unlicensed wifi hotspots connected to fiber nodes will provide users with mobile connectivity, and Google won't have to ask permission from AT&T or Verizon to introduce a new device or service.

 

Vertical integration

Google is not alone in climbing the heights of vertical integration. Apple and Facebook are working together more closely, with Facebook the default calendar and contact app in Apple's latest operating system. And Facebook is supposedly planning its own phone.

What competition law has to say about the personalised, vertically integrated ecosystems now being built by Apple, Facebook and Google is far from clear. Consumers will have a choice of competing handsets, as they do now. But their subsequent options (what calendar, what map, what apps) may be sharply limited. Signing up with a particular brand of personal assistant will lead to a cascade of path-dependent filters, as software learns more about its users and serves them more directly.

In response to European and US competition authorities, Google is likely to agree to better labelling of its search results to more clearly show Google's commercial relationships to particular links. This may be a solution to a fading problem. As "search" becomes an anachronism and personalisation the new normal, we'll have deeper issues to deal with.

 

Gulf News
Retail Gold Rate
Business Editor's choice