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Did the US government miss the opportunity to contain Google? I asked this question in this newsletter five months ago. Newly uncovered documents suggest that the answer is yes.
On Tuesday, Politico published articles based on previously hidden internal memos of an Obama-era government investigation into whether Google used its power to stifle competition and hurt Americans. The Federal Trade Commission concluded in early 2013 that Google’s behavior was not against the law. However, the company agreed to change some of its business practices.
When I retrospectively read the documents, I was impressed that the investigators saw red flags in Google’s behavior but disagreed as to whether they should or could do anything about it. There are currently three antitrust proceedings pending against Google, and the government is now citing some of the same red flags that investigators have seen as evidence of the company’s illegal monopoly power.
Could the downside of Google’s impact on online advertising and digital information be avoided if the government had put more guardrails in place on areas of behavior that some FTC employees found worrying almost a decade ago?
Let me go through three points or questions I have from this plethora of Google Docs:
The roots of current cases against Google:
Of the three antitrust lawsuits that are currently pending against Google, I will focus on two: First, the Ministry of Justice claims to have used business deals with Apple and Android smartphone companies to consolidate our digital lives. And a group of US attorneys general alleged that Google hobbled online specialists in areas like repair services and travel reviews.
The funny thing about current government lawsuits is that much of the behavior is old news. Not everything. But much. That was clear beforehand, but the FTC documents made this undeniable. (The Wall Street Journal also received part of one of these documents in 2015.)
The Politico documents show fears within the FTC in 2012 that Google would use its money and power to ensure that its search box occupies a prominent position on smartphones and to expand its digital dominance. That is essentially what the US government (and the European Union) are now saying that Google has done. Google has said the government’s claims have no value.
Based on interviews and emails from executives at Google and other companies, government officials found that Google was promoting its own products – and in some cases downgrading identical online information from competitors – because it improved Google’s bottom line. Again, this is behavior that is at the center of one of the state lawsuits.
In a blog post, Google said the documents backed the company’s view that its behavior most likely benefited consumers.
I wondered what if Uncle Sam had made different decisions nearly a decade ago – and many times before and since.
What if the 2012 FTC economists hadn’t downplayed the possibility that Google could use money and coercion to secure its power on smartphones? Would a different choice of agency have changed the direction of the smartphone industry and the internet? Would you read this newsletter on your Amazon or Mozilla cell phone and would that be an improvement?
Almost a decade ago, some FTC employees were concerned that Google was pulling information from sites like Amazon, TripAdvisor, and Yelp – even when those companies asked for it – to make their own web search results more compelling. The staff wrote that the behavior signaled everyone on the Internet that Google could do what it wanted.
What if the government tried to stop Google’s bullying back then? What if the government forced Google to open their search results to outsiders? Today, when you’re looking for hotels in Niagara Falls or a nearby pediatrician, Google mostly shows the information it has collected, rather than listings from TripAdvisor and ZocDoc which might be more helpful. US government officials were also concerned about this behavior.
These decisions led to the internet we have today. It’s one that Google has made itself the first and last stop for a lot of internet searches. In an alternate story, we might have more and better options online.
Is there no point in playing “what if”?
The desire for a different internet doesn’t mean the government should twist the law to make it happen.
The Politico documents show that in 2012 FTC staff believed that in some cases the law was not on the government’s side, or that what Google was doing might be suppressing the rivals, but also the search results and that Internet has improved for us. That could also be the case today.
The FTC staff are also not fortune tellers who could have predicted how online competition would play out.
In hindsight, however, it is not surprising that the internet economy might have been different and less dominated by giants today if the government had tried to change Google’s business practices back then.
Before we go …
A middle ground on the contractor status of Uber drivers: Uber and similar “gig economy” companies have made an effort to treat their couriers as conventional employees. My colleague Adam Satariano writes that after losing a major legal battle, Uber has pulled back from a tough stance in the UK and will offer drivers in the country a minimum wage, vacation pay and some other perks.
What happens to virtual learning technology? My colleague Natasha Singer writes about distance learning technologies that may persist if personal education is widespread.
Wikipedia wants to be paid: Wired reported on Wikipedia and tried to keep a free option for most of us and make a paid version for commercial users like Google.
How did I know nothing about squishmallows before ?! My colleague Taylor Lorenz buried himself in the brightly colored stuffed animals / pillow things that people collect, display and hug.
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