Antitrust oversight of Google, similiar to what was done to Microsoft in the 2000s, will do more than spinning off any properties from Google.
Google is able to invest in and made Chrome popular using cash from their advertising business, and Chrome's popularity allows Google to shape the web environment for their advertising business. If Google were to lose Google Chrome, there is nothing that would prevent them from directly or indirectly evolving Chromium. If Google is prevented from making a browser, then they could even move the focus of computing away from the web browser with power from their search business.
Therefore, antitrust oversight is required to curb the types of behavior that lead to the antitrust situation in the first place.
Google makes the browser because they are profoundly vulnerable otherwise to platform owners demanding payment for access to their platforms. Android exists because Google wanted protection against a Microsoft mobile monopoly that seemed inevitable (of course it turned out to be the Apple mobile monopoly that was the real threat; notice that Google has to pay Apple billions annually for access to their platforms). Internet explorer was a similar threat. Chrome was the response to that threat.
If Google can't influence this, then there will be other platform owners who will the ones with all the margins. A world where Microsoft and Apple just squeeze all the profit out of the internet is not obviously (at least to me) better than one where they can't.
I agree, but feel like this is only a problem because antitrust rulings are blue-moon events. In a healthy system I would expect Google to be restricted from dominating the browser landscape, and in turn Apple from restricting access to their platform.
Market power is a difficult thing to wrangle. There isn't going to be any policy which can't eventually be worked around by some party. The policy has to evolve with the landscape.
That's the thing that makes me uneasy about this. I'm ok with some regulation of Google and perhaps even some kind of breakup. What I don't want to see is regulators picking winners and losers. I'm concerned about Google's control over the web but at least their interested are aligned with the survival of the web and not completely locked down & proprietary platforms like iOS.
The market Google and Friends are in is not a horse race.
It's more like you know that someone is manipulating the bets on the horse race, possibly even forcing results by paying off the competitors. If you do nothing, you are picking winners (the betting house) and loosers (the betters), if you do something you reverse that.
In my above example, by doing nothing you pick winners.
Not in all situations, doing nothing is doing nothing. Take the famous trolley problem. By doing nothing you pick 5 people to die, if you do something you pick 1 person to die. One of those will come true, either inaction or action will determine which. But that also means your inaction is an action of yours to force an outcome. This doesn't necessarily mean it's the outcome you want or the outcome that is preferred. Inaction can be the worst type of action to take in some scenarios, but it is the action of non-intervention that creates an outcome regardless. Inaction doesn't mean you consent to the outcome either.
Sometimes, doing nothing is even illegal, eg not helping someone who is in danger when one can do so at no risk, or sometimes, not reporting an ongoing crime (I think they can be illegal, here where I am)
Both forms of “Silence is (not) consent” are true, they just refer to different things.
If you are in a position of authority, silence is effectively consenting to the status quo remaining unaltered.
If you are not in a position of authority, whoever is in that position can’t take your silence as consent of their choices.
That's the wrong analogy. Regulators aren't random spectators sitting in the stands, they are the referees. The better analogy would be if you were assigned to monitor the race for violations, and you discovered the winning horse had broken a rule. As the referee, your decision whether or not to enforce the rules has a direct impact on the results. Just so, if regulators choose not to act, they are picking the incumbents as the winners, whether or not that is ideal, best, legal or good.
In this race every horse is breaking every rule they can get away with and exploiting every advantage. If you suddenly want to jump in and start enforcing rules, which I think probably should happen, you need to be very careful that you don't wind up making things worse by legitimizing the abuses of only one horse. If you can't do that then you're better off just letting them fight it out.
We've already arrived at that station. The rules are already enforced such as to legitimize the abuses of a small number of horses in each vertical. If we let them fight it out, they will only further entrench and consolidate, which is the worst thing that can happen. We don't need to act like battered housewives afraid that it could always get worse - the laws are already on the books to fix the issue, we just need to insist on their vigorous enforcement.
But anti-trust law is vague, and violations are often in the eye of the beholder. A sports game is also the wrong analogy because sports games have very clearly defined rules, specifically to avoid referees picking winners.
Governments are nowhere near that level of rigour or coherency, especially if you look at EU anti-trust. The USA at least requires the government to demonstrate some actual harm to consumers in court. EU anti-trust requires a single bureaucrat to decide that competitors were harmed, and they can then levy any fine they like which goes straight into the EU Commission's coffers. It can only be appealed in some sort of court after the fine is paid, and the court is packed with judges who want to see the EU expand (via spending), so that's cold comfort.
That approach is incoherent: the whole point of capitalist competition is that the better firm in some sense harms the weaker firm by taking away its customers. And giving the referee the power to transfer money from the competitors to their own pockets at will, without needing to convince anyone else at all, is clearly an enormous conflict of interest.
Many arguments about anti-trust do implicitly assume the US model, which at least has some tenuous connection to harm to the general public. That isn't really true internationally, yet ramped up anti-trust in the USA would absolutely be taken as a green light by other parts of the world to whack US firms with enormous fines for conduct that isn't actually bad in any way.
> But anti-trust law is vague, and violations are often in the eye of the beholder. A sports game is also the wrong analogy because sports games have very clearly defined rules, specifically to avoid referees picking winners.
Have you ever watched sports? The referee always has an impact whether they blow the whistle or not. Every rule requires some level of interpretation or fitting to a given situation. Some sports (mainly soccer) don't have rules, they explicitly have "laws of the game" because it's understood that they are to be interpreted.
> That approach is incoherent: the whole point of capitalist competition is that the better firm in some sense harms the weaker firm by taking away its customers. And giving the referee the power to transfer money from the competitors to their own pockets at will, without needing to convince anyone else at all, is clearly an enormous conflict of interest.
...you know regulators don't get to keep any money right? Their job is to set market rules, enforce them, and break up any competitor who gains too much market power. Where exactly is the conflict of interest? Historically, most shareholders wind up making more money off the future value of the broken-up interests than they did with the original conglomerate.
It seems like you are arguing from an EU standpoint, and I don't know anything about their antitrust history, so I'm not going to try and defend or interpret what Europe does.
you know regulators don't get to keep any money right?
This is exactly my point. They don't ... in America. In the EU anti-trust fines are both created by and collected by the Commission, specifically, a high ranking Commissioner. Those people are selected not for any particular expertise in their subject area but rather nominated by countries and selected for political reasons. The money goes straight into the general budget of the Commissioner's employer, and then handed out in "solidarity" payments, subsidies, bureaucrat salaries and other priorities of the Commission.
Bureaucrats have their own set of incentives. They can increase their position within the bureaucracy, and increase the bureaucracy’s influence.
One of the reasons Americans are so “anti-bureaucracy” is because of precious bureaucratic oversteps.
It’s pretty well established the EUs administrators strongly value the influence I’d their own agencies (with some exceptions).
A good US example is the military. Army, Navy, Marines, etc. are in constant competition. Do any of the generals or admirals get to take home their funding?
Google AMP is bad. Google Pagespeed Insights is bad and misleading. Google has its own agenda for the web, and it doesn't really align with anything but the survival of Google.
I think that goes too far. Google does have an agenda for the web but at least it includes the web. Apple would like nothing better for the entire internet to be locked down and controlled inside its app store. We're better off with Android and Chrome than we would be without them.
I hope some pseudo open source components come under non profit with reduced Google control. So other big player have bigger say in stuff Chromium and Android.
Worse, the corporations have to meddle with their own regulation because they know other corporations will. My understanding is AT&T basically wrote its own consent decree.
Who in their right mind decided that the solution to a national monopoly is a handful of regional monopolies...
> In the early 1970s, American antitrust regulators became suspicious that Bell was abusing its monopoly power, and in 1974 the Antitrust Division of the U.S. Department of Justice brought a lawsuit against Bell claiming violations of the Sherman Act. In 1982, feeling that it could not win, Bell agreed to a Justice Department-mandated consent decree that settled the lawsuit and ordered it to break itself up into seven "Regional Bell Operating Companies" (known as "The Baby Bells"), which it did in 1984, ending the original company's existence. These "Baby Bells" are now independent companies, and several of them are very large corporations in their own right, such as AT&T, Verizon Communications, and CenturyLink.
> What I don't want to see is regulators picking winners and losers
I'm not thrilled by the idea either, but I'd prefer it to another round of IE6. When it comes to dealing with monopolies I think you're solidly in the realm of looking for the least bad choice.
I don't think IE6 really compares to Chrome. IE6 froze the web in time and made impossible for standards to evolve. Chrome may be in danger of becoming synonymous with the web but it's hardly standing still. In fact the most common complaint is that it's adding features too quickly and trying to do too much.
IE6 was the most innovative browser of all until it won the race. I don't think we're at the stage yet where we can say if Chrome can be compared or not.
The features they are adding are often unnecessary and designed to help them further lock down the web, prevent ad blocking, etc.
I’m surprised no ones even noticed that Portals are basically AMP Supercharged to where you’d never leave Google. Truly dystopian future they’re trying to slowly cement.
> The features they are adding are often unnecessary and designed to help them further lock down the web
Reminds me of the Browser Wars of yesteryear, when Microsoft and Netscape invented their own unnecessary, easily abused, proprietary HTML tags, such as blink and marquee.
It's easy to look backwards, with the benefit of more robust and fast (relatively!) standards bodies, and shake a finger.
But my memory at the time is that there were essentially no effective, consensus-based evolutions of web standards, because everything was so new.
Even the idea of running executable code in a browser at all was "That's weird. Is this a thing we want to do?" and resulted in 10+ variations (of which javascript ultimately triumphed).
It was certainly a worse time for the consumer, and web developer, as essentially everything was broken on every platform but your target w/ your target plugin installs.
If Google, Apple, and MS were prevented from developing web browsers, who would? The mass public wouldn't bother buying a copy of Netscape.
We'd likely have skipped over the web entirely and gone right to native app stores for everything, like the bad old days on cell phones.
Most of their revenue comes from Google. In this hypothetical example where the largest tech companies are no longer involved in Web browsers, where would Mozilla's funding come from?
Funding would still come from Google to buy there way into the default search engines list. Just because Google loses Chrome in this hypothetical doesn't mean they don't care about search and ads anymore.
> notice that Google has to pay Apple billions annually for access to their platforms)
uhhhh, doesn't Google pay Apple billions to be the default search engine on iOS? That's not "forced to pay for access", but "choses to make a business deal that costs them billions to make them billions more"
See my comment below. I meant a more general sense of open, maybe "unbiased" or "biased towards their users preferences". ie., where any decision about the platform (including defaults) is left to the users, or defaulted to their clear general preference.
The "issue" is that they are charging for something the users would set themselves, and otherwise, already want.
Google is being "forced" into paying for this only because apple is willing to act against its users preferences, and eg., set a Bing default.
> Well, consider that if Apple were an open platform, this default would be set by most "for free".
> If the platform invited the user to set a default, or was "biased towards their user's preferences", as most would select google, google would be the "natural default".
You almost make it sound like defaulting to Google without making people aware of the alternatives is “open” and unbiased.”
I get that iOS is closed down, but I'm a bit confused how being "open" would resolve the fact that a default search engine for Safari is set? You can still change your search engine on iOS (to one of few the browser ships with, Google, Yahoo, Bing and Duck Duck Go in UK)
Firefox is completely open/open source (isnt it?), yet Google pays Firefox for being the default search engine.
Open vs Closed has nothing to do with this. Google wants to be the default in browsers, and it choses to pay for the luxury.
I mean open in a more general sense, not of its source code.
If the platform invited the user to set a default, or was "biased towards their user's preferences", as most would select google, google would be the "natural default".
There is a sort of mild rent-seeking / racketeering in asking google to pay to configure a service Apple provides, to a default Apple's users would chose for themselves.
Google pays Apple to advertise their Search Engine in Safari. Google, like every website, gets access to Apple platforms for free via Safari, with no obligation to pay 30% up front nor 30% of any other revenues, be they direct purchases or indirect via ads.
Google is quite fortunate that Apple doesn't block web ads or intercept web payments and charge a platform fee for that.
what really need to happen with ani-trust is to alter the system politically, monetarily and militarily to prevent oligopoly. oligopoly is pretty much monopoly with theatre piece.
Why not split search and AdWords while they’re at it? There are too many perverse incentives created by the combination of Google’s ad monopoly with their search monopoly.
Why not offer two Googles, one for people who don't mind sifting through three pages of SEO results when they search for actual information, and another subscription that cuts out ads for those willing to shell the cash?
For example. If you’re looking to refinance a home loan; you’re easily worth $100-$300 of revenue to Google; with a decent number of searches and clicks (eg “refinance”, “mortgage interest calculators”, etc)
If Ex-Google Ads has the best ad marketplace and can use the space most efficiently, they will bid the most and buy most of the space. So we will still have Ex-Google Ads on Google searches, but they will be owned separately. What difference will it make?
They would be owned, operated, and governed separately, and Search could have the different ad providers compete amongst each other to provide the best rates. Add it all up together and it'd be a huge difference. Each of the two separate companies would have separate management and a fiduciary duty to maximize their own profit independently, even at the expense of the other.
Consider that Verizon and AT&T, the two largest mobile phone providers in the US, are both Baby Bells resulting from the break-up of Bell Telephone Company in an anti-trust action. They compete strongly against each other, in a way that would absolutely not be true if they were still the same company.
Agreed that breaking up a company horizontally into two competing companies creates competition between the two companies. Here we’re talking about breaking up Google vertically into two companies with a supplier-client relationship. The supplier and the client aren’t going to be competing with each other because they are in two different businesses.
It frees up the supplier and client to compete against each other by patronizing other suppliers/clients in the industry. Right now no one else can sell ads on Google Search; after a break up, other competitors would now be able to.
If I had to guess the outcome, we’d probably see Google Search keep its present market share (splitting Search and ads wouldn’t help Bing Search beat Google Search). Google Ads and Bing Ads would both bid for space on Google and Bing, in addition to other players. Disrupters might be able to take some market share here by having a cheaper cost structure, or Google might dominate because they have the best tech.
Courts will generally not second-guess the judgement of management, but they are obliged to act in the interest of their shareholders, primarily, because shareholders have the ability to fire the board of directors.
If someone who owned a share of Search Google managed to get a controlling interest in Ad Google and was operating it to benefit Search Google to the detriment of Ad Google's minority shareholders, that would be one of the rare cases where a court would intervene.
I'm more referring to what the shareholders will do if the company is clearly not acting in the interests of actually making them money, but rather, cozying up to an now-unrelated company in a way that leaves lots of potential money on the table for no reason.
> I'm more referring to what the shareholders will do if the company is clearly not acting in the interests of actually making them money
That's fine, but "fiduciary duty" is a specific legal concept and you are misusing it. Making shareholders angry enough to vote you off the board is not the same thing.
Also, it's worth noting that institutional investors often rubber-stamp the board's recommendations in shareholder votes. One side effect of the rise of passive funds is that there is less shareholder opposition to board moves nowadays.
Countless shareholder lawsuits say otherwise though. So it may not be their fiduciary duty, but if there's a good chance they get sued if they don't maximize profits, they will anyway.
> Countless shareholder lawsuits say otherwise though. So it may not be their fiduciary duty, but if there's a good chance they get sued if they don't maximize profits, they will anyway.
No, they don't. In fact, I can't find any that involve maximizing anything.
Also, filing a lawsuit is trivial. Succeeding is a whole other kettle of fish.
The Baby Bell breakup was 36 years ago, resulting from antitrust action brought 46 years ago. Moreover, AT&T and Verizon have consolidated six of the seven Baby Bells into the 2 companies.
But it left the local monopoly in palace instead of mandating Local Loop Unbundling which is why the US and Canada has such poor competition for highspeed internet.
2 is still more than 1, and there was a lot more competition in the intervening decades when there were more than 2. So it sounds like it worked for the most part? Certainly more so than doing nothing.
The issue is that the baby Bells were allowed to reconsolidate at all, or allowed to avoid competing in other provider's coverage areas. I agree some good came of the breakup, but the hands off position taken by subsequent administrations has allowed most of the Good to get undone.
> Now that Chrome is the leading browser they are turning off targeting for everyone else, so that only Google has access to target users
What - in detail - does this mean?
Because it doesn't appear true in anyway I can see. I can still buy ads exactly the same way targeting the same characteristics I've always been able to.
You reminded me how impressive it is, in a way, that Google made the Chrome play knowing it would take years and years to bear any fruit. I’d be interested to learn internally how that got incentivized and managed.
> similar to what was done to Microsoft in the 2000s
Meaning there will be a ton of news about their case but the whole thing will disappear in a puff of settlement-smoke ten months after an incoming president takes office?
As someone who managed to be a class member to multiple state-level anti-trust actions against Microsoft, I'm still disgusted how one of the class representatives sold us out.
I remember trying to figure out how to intervene as a non-lawyer and eventually giving up without filing anything. After giving a pitiful offer of a few dollars per class member, they had it such that the rest would be donated to the schools (Apple's last stronghold at the time) and could only be used for new, whole computers, not peripherals or other stuff. This was such a bogus restriction to put on the money that it made my jaw drop. But not being a lawyer, all I knew was that a pro se filing was likely to be ignored.
If I had to do it over again, I would love to have argued about how the settlement was calculated to create a new anti-trust injury and would have requested relief by having a guardian ad litem for the class, after rejecting the current offer. Still not sure it would've gone anywhere, but maybe it would've at least pushed back at the nonsense.
Yeah, but then there's no one left in the class, essentially. What am I going to do in court as someone with a single copy of Windows 95 and Windows 98?
"If Google is prevented from making a browser, then they could even move the focus of computing away from the web browser..."
If that ever happened, I think that would be a vast improvement. There is much more to the internet than just the web and a handful of ports used by browsers.
Internet advertising mainly lives on the web; it's maninly delivered through those ports opened for the web/apps.
Google is able to invest in and made Chrome popular using cash from their advertising business, and Chrome's popularity allows Google to shape the web environment for their advertising business. If Google were to lose Google Chrome, there is nothing that would prevent them from directly or indirectly evolving Chromium. If Google is prevented from making a browser, then they could even move the focus of computing away from the web browser with power from their search business.
Therefore, antitrust oversight is required to curb the types of behavior that lead to the antitrust situation in the first place.