Reporter totally misses the point. The point is that google provided google maps for free. That is great. except when all other competition dies (because who can compete with a better, freer version of your product?) google starts charging pretty rediculous rates.
That move in itself is what contributed to the ruling. OSM is free for everyone. It is a wiki. If OSM destroys google, bing, etc, and then decides to go on a charging spree (it can't) then it would also face similar decisions.
So the answer to a monopolist commoditizing a market is... to introduce a cartel? Because this is basically what this judgement argues: Google should charge something in line to what its competitors do, and forget about any downward pressure on prices.
I'm not a free-market zealot, but this sort of ruling is really bad for small players. Googlers understand the internet and so they make money while lowering prices for consumers, why should we punish them for this? Then we might as well say the copyright mafia is right and the internet should be tightly regulated and controlled by cartels.
"In a ruling Tuesday, the Paris court upheld an unfair competition complaint lodged by Bottin Cartographes against Google France and its parent company Google Inc. for providing free web mapping services to some businesses."
It looks like the issue isn't that it's free; it's that Google provided free maps services to some businesses while charging others. That's the gist I got from the article, anyway.
If Google is forced to charge the same prices as small mapping companies, those companies should have less of a disadvantage. It's not really a cartel if anyone can join. There are plenty of reasons why this is a bad idea, but at least I understand why France is trying it.
"That is great. except when all other competition dies (because who can compete with a better, freer version of your product?) google starts charging pretty rediculous rates."
This is what happened with big malls in Europe, small retailers could not compete in price so they got out of business. Now some of the malls have bigger prices that what small retailers had, as they have way less competition. E.g Carrefour bought all the malls here so all them are Carrefour now.
Actually, this kind of law does not make any sense. In the case of carrefour, since they are charging such high prices nowadays, what prevents a bunch of farmers to associate themselves and open their own mall to sell cheaper and regain market share?
Nothing, absolutely nothing. They just can't be bothered.
Lack of competition is not only about big brands killing small ones. It's also part of the culture. It's been a long time that entrepreneurship is dead in France. I know what I'm talking about, I AM french.
>> This is one of the situations in which free market fails to deliver the optimal (for consumers) solution.
I never considered the free market idea to be based on delivering the optimal solution for consumers, actually the oposite, it delivers the optimal solution for enterprises, specially the big ones where the real money and power is made and retained or traded.
Market does not preocupy with people, the state does (In theory. In practice the state may just pretend to preocupy or simply perform poorly or corruptly). Nevertheless, Market's only concerns are Buy and Sell, anything it says is Marketing and everything it does is Strategy.
It's not just about prices. It was only about prices, then there would be McDonalds everywhere and nothing else. If farmers were to open their own stores, they could still manage to have reasonable prices, and make their point on "best quality", "organic food", plus offering some plants / species you would never be able to find in a big supermarket. You can't go head to head against Carrefour by just providing the same service. They would have to differentiate. That's how free market works. There are always needs that the big competitor will not be able to cater to.
You do realise you're actually arguing against your own point 2 up?
You said the reason the small traders went out of business is price, but now they suddenly shouldn't differentiate on price?
You don't really seem to understand monopolies or free markets or how they operate.
1. Monopoly emerges
2. Competitor opens
3. Monopoly slashes prices in local store, while maintaing prices in all others
4. Competitor runs out of cash, closes
5. Monopoly puts prices back up
That's how it works. You can also replace 3 with 'Monopoly slashes prices everywhere and relies on its cash reserves'.
But hey, you ARE French, of course you're right. The same thing of big chains killing all small towns isn't happening in the UK too for example. Oh wait, it is.
Nope, I was not arguing about my own previous point. In the first one, I replied to the idea that Carrefour is overcharging for food, and that then nothing prevents producers from selling their own products at a cheaper price. They can start small and setup their own distribution.
My second point was to reply to another idea floating around, that "if a new competitor enters the market, Carrefour will slash their prices to kill them off". Then, the small producer has the choice to differentiate if they cannot fight on price.
By the way, since I'm French, I may as well remind you that in every small town and big city of France, there are still weekly markets where local producers come and sell their products, very often for a higher (and not just a little higher) price than what you would pay in Carrefour or other supermarkets. And guess what ? Some people STILL buy their food there. Not everyone, but quite a lot do. So, there's nothing preposterous about the idea I was proposing, because there's clear precedent, even in the current market situation. Some people will always be paying to pay more for "quality", "traceability" and direct-relationship of trust between the buyer and the seller.
Now, for most people (not the ones I just mentioned), you also have to realise that Food has become a commodity, and therefore for those people, they are not going to be interested in paying more, they simply want to get their food as cheap as they can, so they can spend their money somewhere else (ipad, new tv, vacations, etc...).
It's all about knowing your consumers in the end, and finding out how you can better serve (some of) them.
Coming back to the discussion, the competitors of Google Maps should be thinking of how they can provide more value to users than the "free" Google Maps. By the way, in other markets, like video games, some online services like Steam have no problem fighting against free offers (i.e. piracy) just because they provide more convenience to the end users. They get it, and they don't bitch about piracy or whoever else killing their business.
When you start pointing fingers around, it's usually your product/offer/service is simply not good enough, or nobody cares about it.
"That's how it works. You can also replace 3 with 'Monopoly slashes prices everywhere and relies on its cash reserves'."
So are we going to have laws now where big companies can't lower and raise their prices?
If you want to blame anyone, blame the consumers that only shop for the lowest price. Walmart is a good example of this in the US.
The other problem is that as a small business, you just don't have the resources as the big guys. For example, you might order 1000 widgets from a supplier for $10,000, but because your competitor orders 100,000, they can get a bulk discount and charge a lower price.
Unless we have laws that prevent a business from getting to a certain size and keeping them all small (which I am against), there isn't any way to stop the above scenario.
Similar to how software, music, and movie companies need to change their business model, so do small companies. With globalization becoming easier and easier, they need to offer something that the big guys can't.
Trying to compete on price will only put you out of business quickly
I didn't say that, I was just pointing out that when you get to the point of a monopoly it's very hard to get back. Worse still the big company then starts lobbying to make sure it stays a monopoly, America's phone networks are a good example of that.
Also the other big problem with monopolies is that they squeeze their supplier dry as they're the only game in town. So here in the UK the supermarkets are squeezing the farmers' margins to the extreme as if they take their business elsewhere that farmer's out of business. Who else can he sell the millions of tonnes he has in the ground to?
Further problems are caused by the big guys doing stuff like pumping water into chicken breast to make it look plump and increase the weight, increased revenues, customers think they're getting more for their money based solely on price/weight.
I also lament the death of bakeries, for example bread from supermarkets is horrible. Donuts suck. We used to have Chelsea Buns where I grew up, the dross they sell in supermarkets is roughly a tenth of the 'tastiness', it's just crap. But all the bakers are out of business because who wants to visit ten stores and pay more when you can visit one?
Over here in the UK they used to restrict how close a supermarket could be built to a town centre in order to curb their growth. I think they've relaxed that now as they've definitely got closer than they used to be. That's one example of how they used laws to try and give the smaller guys an advantage.
Another example is they have restricted the opening hours, but the supermarkets are now opening convenience stores, in my city centre alone there are 6 Tescos within 5 minutes walking distance of each other.
How to stop it? Should we stop it? I don't have any answers unfortunately. If I did I'd probably have a Nobel prize.
EDIT: The part of me that wants it to stop is that it's all so homogenous, all the stores are laid out exactly the same, they've all got the same 6 ready meals, the same 6 meat items, the same 6 larger brands, the same 6 cakes, the same 12 brands of crisps, the same 15 chocolate bars. Where's the local produce? Where's the seasonal produce? What if I don't want a pepporoni pizza, I want a chicken one? Is life really supposed to be that fucking boring? I rarely swear here, but I feel it, really feel worried for our collective soul.
I wouldn't compare phone networks with retail, it's a totally different situation. Phone networks are nothing but state-allowed monopolies. Retail chains win by other means.
I can relate with how you feel, that it's sad to see small stores disappear and all. But it has never been easier than now to actually go and get your products directly at the farmer, if you really want to. Most people have a car and the countryside is not 3 hours drive from where they live. It is technically possible to go and get your food outside of the retail chains if you want to spend the time to do it.
Most people have no interest in doing so, because they want convenience. They want to save time. They do not think it's worth it. It's pretty much a cultural problem, not a market problem.
In France you still have lots of bakeries around because people still value Bread quality over price. Since bakeries are widely spread, they are reasonably convenient to access. So the business thrives, no matter if the big chain sells the bread dirt cheap next door.
How do we stop it ? Start with education. Tell your children what's the difference between the supermarket food and the rest. Explain why it's important to eat well. It's the same thing as explaining to a kid why it's necessary to save for the time when they are old and cannot work anymore. Education is especially important since most people nowadays are born in cities or suburbs, have completely lost contact with the culture of food production, and just see the end product. It's going to be tough to change that state of things, if cities continue to grow.
And the response to this is... to force the monopolist to keep its prices unnaturally high, hence raking in even more profit and making it even more likely that competition will be squashed, and screwing consumers?
Because that's what this judge is arguing, basically: that Google and other mapping companies should "cartel up" and just be fair among themselves, smaller companies (and progress) be damned.
The free market doesn't fail in this case. Consumers fail. Just like when there is traffic on a highway, it isn't networking theory that fails, it is drivers.
Consumers choose to shop at Carrefour, and fill their coffers with money to smash smaller chains. Maybe if consumers were smarter, or cared a little bit more, they wouldn't shop there? I can only blame ignorant consumers and not carrefour or the free market in general.
Even if 10% of consumers thought that Carrefour was onerous and damaging to their society, and were willing to pay slightly higher prices - they would provide enough demand for other smaller shops to open.
But they don't, because people don't want to bother spending 50 cents more on gas, and paying 5€ more on their 70€ purchase.
I suspect you're getting downvoted because your suggestion suffers from the free-rider problem: everyone who chooses to continue shopping at Carrefour free rides off those who don't, yet they still obtain any supposed social benefits.
How? How is someone who buys at Carrefour free riding off of those who don't? Carrefour has very efficient supply chains set up, and can therefore provide cheap goods. I don't pay more for a tomato from my neighborhood farm because Carrefour imports tomatoes from Algeria
You're suggesting these people are paying more because Carrefour was "onerous and damaging to their society". In other words, they're treating competition to Carrefour as a social good. Society is better off if enough people shop at competing stores, but no individual customer has an incentive to shop at competing stores.
> Actually, this kind of law does not make any sense. In the case of carrefour, since they are charging such high prices nowadays, what prevents a bunch of farmers to associate themselves and open their own mall to sell cheaper and regain market share?
The knowledge that the big mall will simply temporarily lower its prices below what the collective could reasonably do (due to their lower size/efficiency) until they're dead, and then re-raise them again?
Actually, this kind of law does not make any sense. In the case of carrefour, since they are charging such high prices nowadays, what prevents a bunch of farmers to associate themselves and open their own mall to sell cheaper and regain market share? Nothing, absolutely nothing. They just can't be bothered.
Nothing? Never had any experience in retail business ownership, right?
For starters, because Carrefour has a HUGE cross country AND multi-national supply chain. Because of it's mass wholesale ordering it can assure killer prices and it also has money-to-burn in the bank. So, if they threaten it, it can lower it's prices for a while to compete, until it destroys them. They cannot afford do the same.
Second, Carrefour has the scale, which means it also has: thousands of other goods, exclusive deals, loss leaders, etc. Even if Carrefour couldn't compete on price (which it can, 200%), but had somewhat similar prices, it wouldn't make much sense for the buyer to spend gas plus time to go to two places just to buy some stuff cheaper in one, if he can get everything he wants in Carrefour.
Third, Carrefour with its size, get the lion's share of advertising. Which DOES matter.
Lastly, it's the bloody cost. It's another thing to open a retail outlet in a competitive environment, and totally another to open one where a few big mega-malls have saturated the market and killed everybody else. Uncertainty, and the ample opportunities for the big guy to crash you at will makes the move all too risk.
That's it, in a nutshell. Why you'd believe that the problem is that they haven't thought of it, or that they aren't "entrepreneurial" enough?
(Btw, such moves are even attempted in a lot of places with similar conditions. Very rarely they end well).
> So, if they threaten it, it can lower it's prices for a while to compete, until it destroys them.
Thanks, this argument for antitrust laws is new to me. Is this a standard argument in economics, and do proponents of the free market have some standard answer to it?
Fourth, the government happily interferes in the market on behalf of its buddies at Carrefour by implementing planning regulations that would make it near impossible to open a competing mall.
That also. In France in particular they have regulated the production of cheese to kill traditional small scale producers (and, arguably, real bloody cheeses!).
Google maps includes sponsored locations when you search for things on the map.
Are we going to also prosecute Google for providing free web search, making it impossible to make a competing search engine that charges users 10 Euro cents per query?
You've missed the point entirely. If Google provided free web search, killing off all commercial competitors, and then started charging fees for searches now that all competitors are dead, then yes, they would probably be prosecuted.
If GMaps had remained free this whole shebang might have been avoided.
Maybe naive thinking but you could let them sign a contract which doesn't let them sell google-maps in the future. If they don't sign you know what their intentions are...
Why couldn't competition spring up once google starts charging ridiculous rates? It's not as if competition dies forever. It dies until someone else figures out how to do it better.
If the local sandwich shops start charging ridiculous rates, it's not very difficult for someone to move in and do it for cheaper.
When Google owns all the cartographic data, how exactly do you intend to compete as a newcomer? Where are you going to get the 8-figure investment to even begin to make the smallest dent against the massive dataset you need to collect?
This is the problem with the perfectly laissez-faire view: it discounts the fact that there is, in many cases, a huge barrier to entry for all new entrants once someone has the market locked down.
There is a difference. Wikipedia and many open source projects cannot forcibly switch to paid model, because they are currently giving their content away under CC-BY or GPL and you can keep a copy of it. If they started charging, you can fork the project and continue charge-free.
Google maps API is a service controlled by Google. You cannot replicate it and keep using it if Google changes its mind about the licensing.
That doesn't matter. There is no law nor any court ruling even in France against providing free services. Here is the entire key to the issue:
>Bottin Cartographes argued that Google was only planning to give away the service for free until all the competitors had been driven out of business and then they would start charging.
It's not about free services, it's about willfully plotting to gain marketshare via free services with specific intent on charging for the service once the competitors have been driven out. While I believe the French ruling is faulty (where is the proof?), this isn't an issue of free vs paid.
The analogy only works if Wikipedia has specific intent to begin charging for access once your business is gone.
I don't know the specifics of this case, but Google did start charging for Maps last year for commercial users, at least in the US. That may be enough to prove intent?
I have no idea. Like I mentioned, I'd like to see the proof before I believe Google was planning this. Obviously it was enough to convince the courts, but I know courts can be deceived and biased (especially when it's local companies vs foreign companies).
Well, either you did not understand the comment you are replying to, or you believe that Wikipedia will charge for its access. What does make you think such a thing ?
Actually, Wikipedia can't change the license on existing articles to a more restrictive one, as copyright in the articles remains with the mass of editors that wrote them. In fact, they had to get FSF to add a special exemption just for them to an updated version of the GNU FDL so they could add the less-restrictive CC to their set of licenses.
I think the big difference is that Google is using the money from it's monopoly search to artificially subsidize maps below cost. OSM and Wikipedia etc. are doing no such thing.
I agree, except with your OSM component. I'm not sure it matters that OSM is non-profit. They still can produce similar effects as a for-profit version.
Didn't they start charging because they started getting sued for offering it free of charge?
And according to other reports it's apparently illegal in France to offer something for free if it costs money to develop. But what about those who enjoyed using the free stuff and even built businesses on top of it?
The law says it's forbidden to sell something at a loss. While it's straightforward to evaluate when you resell a physical good as-is, it's quite more shady when you do some transformation (maybe at least the sum of its components?) and outright undefinable for intangible goods, let alone a service. That's the letter of the law, but the spirit of the law is to prevent undercutting your competitors to death.
I bet all of this is tied to IGN (France's national mapping agency) offering GéoPortail, a free but absolutely crappy service and a paid yet just as crappy service and dying a horrible, deserved death. They should have kept doing what they do right: providing map data and securing a deal with Google or Nokia for the aerial and street shots, and the maps.
I think this comment should be somewhere at the top. There was a similar law for a long time in Ireland, precisely to prevent companies with a large capital base from pricing their competition out of the market and then raisin their prices afterwards. If this is the reason they were sued, then it's not as big a deal as I thought from the headline.
From Sowell's article:
It is a commentary on the development of antitrust law that the accused must defend himself, not against actual evidence of wrongdoing, but against a theory which predicts wrongdoing in the future. It is the civil equivalent of "preventive detention" in criminal cases -- punishment without proof.
Federal Rules of Civil Procedure include a requirements that plaintiffs plead on facts rather than possibilities, and have done since the 70s or so. Sowell omits to mention that the Sherman act passed at the end of the 19th century was a response to trusts using novel legal vehicles to circumvent rules against cross-shareholding designed to establish a monopoly. It's not great law (and has arguably been hollowed out over the last 30 years), but market failure was a persistent problem when it was put in place.
Predatory pricing does exist, but several conditions have to be true of the commodity being priced. It must be a rival good, it's production has to have high-barriers to entry and it cannot have easy substitutes.
In the case of online maps, none of those is true. Which is why so many HN readers are surprised by this.
I don't know exactly what this company's product is, but if they offer an API for creating maps on a website it would be a rival product.
Next, the barrier to entry for online mapping is huge. The raw data to generate and create maps is not easy to collect. Especially for satellite images and topo data. And then there's the infrastructure required to actually process and serve the data.
Switching mapping APIs is not always trivial. Along with the different interfaces, most of them have slightly different features. Once a site is using a specific mapping API it's anywhere from a hassle to a major PITA to switch to something else.
True, but API's use hardware that has actual costs so it is a "rival good". For example, GPL code is a non "rival good" in that someone running it on their own hardware costs nothing, a download service that provides GPL code is a "rival good" in that a finite number of people can use it at one time.
Now if Google hosted their map's as a torrent and said, use this for whatever you want. That would be close enough that calling it a non rival good would be a reasonable defense. But, they do charge some customers for using their API which right or wrong opens them up to predatory pricing laws.
Yeah, rival-ness is not a binary value though. In a case where marginal costs of providing a service are very low, it's reasonable to describe it as being mostly non-rival.
> if Google hosted their map's as a torrent . . .
Then it would be non-excludable, which is a different concept from non-rival. It would be rival to the same degree as before, in that it would require marginal computing resources to use. Just the resources required would be coming from the user rather than the provider of the service.
See it that way, when does predatory begins? As a matter of Fact Google Maps is already the biggest on the market with a price next to 0 for users. If we would compare it to something in real life it would: "Somebody has given to a group of people a serious death threat". Then in that case you'd need a punishment.
Anyway, I read some of the comments on this story and I believe take attacks on websites and companies as personal offense. Nothing could be far from reality. A society has to maintain a balance and competition is GOOD. Allowing Google to phagocyte the whole Maps business is not beneficial at all for society as a whole. Actually it's quite bad, even for users.
The French government is not racist, they don't want to attack or kill Google, they want a favorable ecosystem for innovation and fair competition. Google is a big business that can use its other services to temporarily dump prices on one of its product to totally wipe out competition, there need to be safeguards!
As the comments on the article point out, this seems to be about the enterprise maps service to businesses which ordinarily is at a cost.
From Le Monde[1]:
"As such, it considered that Google Maps distorted the rules of free competition by providing the same service to businesses while it undergoes costs to design the product."
["A ce titre, elle considérait que l'application Google Maps faussait les règles de la concurrence en offrant gratuitement aux entreprises le même service alors qu'elle-même subit des coûts pour concevoir son produit."]
The enterprise service FAQ[2] contains:
"Google Maps API for Business is extremely cost-effective, starting at just $10,000 per year. Pricing is based on the number of map page views for externally facing websites. For internal uses, it is based on page views or number of vehicles being tracked. Please contact us for more information."
I just wanted to change your translation (Google translate?) a bit. I think this is truer to the original French:
Hence they (Bottin Cartographes) considered that the Google Maps application broke competition rules by offering the same service to businesses for free, even though Google itself incurred costs to build the product."
How come we assume that Google is going to start charging as soon as competitors died?
I draw analogies with the IE vs Netscape history. When IE became bundled for free in Windows, Netscape open-sourced its code to survive.
Where would the browser be today had a judge ruled that Microsoft cannot do this and that Microsoft (and Netscape) should continue charging for their product?
When IE was bundled into Windows for free Netscape sued in federal court, and won. The DOJ intervened and lessened the impact of the ruling.
Meanwhile, Netscape died. They got bought by AOL and they open-sourced their code as a consequence of dying and becoming mostly a disembodied brand, not as an attempt to survive.
The general consensus is not that IE was a bad thing in the long run. Perhaps nobody likes IE today, but that does not mean it's a bad thing at all. Certainly it was the impetus for Firefox being born and they introduced XmlHttpRequest. Those are important (and GOOD) things.
Also, Netscape certainly did not open source their product until they were thoroughly beaten in the market, ~1998. Before that, they were still trying to make money by selling the software. So, regardless of what you or anyone else says about why Netscape did it, we all know why they did it.
Netscape open sourced their browser so the browser would survive, not so they would. They were continuing to make money off their server products, but they couldn't justify the large investment in a browser anymore.
Looking at the comment again I guess you can read it either way, though to be honest it reads more like he was talking about Netscape the company, not Navigator the browser.
As for long term, after taking out Navigator the browser market stalled for 6 years until Firefox started gaining traction. That's why it was a Bad Thing long term.
MS entire strategy was to hold up the development of the web as it made less from that than desktops, thin clients running web apps frightened it silly. It worked. Hence long-term bad thing due to stagnation.
Who knows what version HTML we'd be on if the browsers had stayed competitive for those 6 years. Instead we're almost at a point where maybe rounded corners will be available to all soon.
I never said I thought IE5/6 was crap when they came out, I myself have rolled out the old XmlHttpRequest innovation defence.
The stagnation of IE was the impetus for FF to rise and start MS developing IE again, not Navigator's open sourcing. Had someone been able to make good money on browsers I'd argue we'd be further down this path.
Yes, I'm the original commenter. I was talking about the browser. Actually, my point had very little to do with Netscape itself. I was merely pointing out that an analogous situation has happened before, and ultimately, the browser market (can we call it a market) didn't turn out to be that monopolistic distopia. On the contrary, from the consumer point of view, many browsers are easily available for free. What's to say that it won't be the case with the online maps and GPS systems?
Maybe it's my fault, I expressed myself awkwardly. Or maybe it's the fact that you'll always find some pedantic know-it-all on the web to accuse you of implying a certain position or harnessing some theories by "reinventing history".
This article is completely biased and titled "a very good decision", its author is known to be anti-google and complains about SERP for his biased website on his twitter account all the time. Pretty pathetic guy.
<meta>
Half serious comments and snark often get downvoted - particularly when they add nothing to the discussion, and almost inevitably when they are appear intended to take the discussion off track by baiting partisan disagreements or fanboyism.
Downvotes should be considered editorial feedback - either you didn't make your point clearly, or your comment is considered likely to derail the discussion.
Use the "edit" and "delete" links, respectively if you are concerned about the karma score of a particular comment.
<additional meta>
It is bad form on HN to complain about downvotes.
While you can use the Google Maps API for free, it has actually some pretty limiting restrictions:
Google Maps/Google Earth APIs Terms of Service, 9.1.1 General Rules, (a):
"(a) Free Access (No Fees). Your Maps API Implementation must be generally accessible to users without charge and must not require a fee-based subscription or other fee-based restricted access. This rule applies to Your Content and any other content in your Maps API Implementation, whether Your Content or the other content is in existence now or is added later."
I am not a lawyer, but I think that would limit solutions where you use the Google Maps API within any Log In based, payed service.
There seems to be an exception for mobile applications though, see "9.1.2 Exceptions (b)", and if you have certain agreements with or permissions from Google, "9.1.2 Exceptions (a)":
http://code.google.com/apis/maps/terms.html#section_9_1_2
If you do not comply with the Free Access (No Fees) requirements, you have to use the "Google Maps API for Business", and the price starts (currently) at $10.000,
see:
"What is the cost of Google Maps API for Business?"
http://www.google.com/enterprise/earthmaps/maps-faq.html
The people this is going to hurt the most are the citizens and businesses in France. No company or entrepreneur is going to want to setup shop in a country where success is punished. No creator, achiever or pursuer of excellence will desire to go to France if they risk being sued the moment they become successful enough to be worth it. Argue all you want that this is about "monopolies" and "anti-competitive" behavior, but what this is really about is greed. The greed of Bottin Cartographes, jealous of Google's success, using a government that doesn't respect private property rights to steal from another. This is reprehensible behavior on behalf of the government, its people, and anyone here who defends it.
If the only differentiating factor between the "monopoly" and a local business is price, the "monopoly" is going to win every time, and this is in fact a _good_ thing and best for everyone as it rewards successful business models. The "monopoly" didn't become successful because it was handed to them, it had to compete and earn it, and now it's enjoying the fruits of its labor. If on the other hand it did not earn its position, but instead lobbied or procured favors from government officials, then it deserves to be shut down, broken up, etc... as this is what's known in a free market as corruption.
Competition does not die in the face of a stronger competitor. Competition dies when rewards are removed and you take away the purpose for competing. Reward inferior products and call it justice, and you'll get more of the same.
Ask yourself this; If this were to happen in Silicon Valley, would Silicon Valley as we know it continue to exist? Doubtful.
If a monopolist offers a product for free just because they have plenty of cash to do so, all rewards to compete in that market are removed. That kills competition stone dead, and that's why we have laws against it all over the world, including Silicon Valley.
Guarding the free market against monopolist abuse is standard operating procedure in all capitalist countries.
Bottin just happens to be the first to take this to court, and happened to have found a judge willing to listen. This could have happened anywhere, it just happened to be in France this time.
You may argue the court was wrong in this case, but the basic principle is part and parcel of every free market economy.
A monopoly does not kill competition, it disuades it. Nobody competes with the monopoly because the incentives are not great enough to do so. The same incentives for success do not disappear because a monopoly emerges. The monopoly must still sell their item to a free market that's free to refuse their goods on moral or pragmatic grounds. A monopoly means solely that they are not challenged by a competitor and can therefore sell their product beholden only to demand, and not supply. Again, this is a _good_ thing.
The demand of the consumers that products be offered at the price they want, as opposed to the company's, is again plain and simple _greed_.
Let's not be coy about it. Consumers want more for less and they seek to use the government and the tyranny of the masses to force corporations, the private property of others, to give it to them. Again, this conduct is reprehensible and any government that encourages it will only be hurting itself and its citizens.
Let me repeat that, a monopoly is not some magical power to force one's will upon the people. In a free market, a monopoly remains subject to the demand of the market and cannot and will not succeed by offering a product nobody wants. Success is not anti-competitive, far from it! Success is the greatest incentive for competition that has ever existed.
You're forcing your desires onto a free market that is clearly making its own choice. You're proclaiming to know more about what's best for people than they do. Leave the free market alone, empower and grant the people their free will, educate, and if you want to change the world, do so by competing and earning it, not by undermining others' rights to satisfy your own ideology.
The governments are (local) monopolies that supply a product(customers) to businesses on the governemnts terms. So, using your logic businesses can choose on moral or pragmatic grounds not to buy from these monopolies (i.e. set up in another country). Please continue to argue how a single incumbent asserting its market dominance is a good thing while arguing a single incumbent asserting its market dominance is a bad thing.
Monopolies which no one is free to compete against (e.g., the federal government) are corrupt monopolies. They use the force of a gun to force the will and goods of other to serve their own selfish greed. The founding fathers of the United States understood this, and instituted a federal system in which states were not only free, but expected to compete against each other. Unfortunately, those who seek power and control over others and their rights recognized this obstacle, and have gradually coerced and persuaded the populace toward supporting an increasingly larger federal government at the expense of free competition amongst states. No one is legally allowed to compete with the federal government, and thus any endeavor in which it labors who's sole purpose is not to uphold the rights of its people, is corrupt. Both Democrats and Republicans are guilty of this corruption, whether out of malice or negligence is of no importance.
There is no contradiction.
A successful business progressing to the point of an earned "monopoly", is still beholden to both competitors and a free market. It has neither violence nor coercion as means to enforce its interests. However, a government monopoly (note the lack of quotes), retains the privilege to force by means of violence any that refuse its product. If you refuse to pay taxes, you will go to jail. If you refuse to go to jail, you will be forced to go to jail. If you refuse to be forced to go to jail against your life, your life will be taken from you. You are not free in this transaction; there is no nobility in the greed of the government to take what it wants at your expense.
It would serve you well to brush up on the definition of a monopoly, specifically as Webster defines it[1]:
exclusive ownership through legal privilege, command of supply, or concerted action
The important distinction here being "legal privilege". The _federal_ government maintains the sole legal privilege to be the provider of many goods and services which _no other entity is allowed to provide_. Google does not enjoy such a legal privilege and is competing in, please excuse the very loose use of the phrase, a free market.
Please do not co-opt the word monopoly so trivially.
So you change your argument from monopolies are fine to monopolies are fine unless they're corrupt, that's fine I'm happy with that clarification, but you must realise that these regulations are there to stop abuse by the corrupt monopolies. So guess what a judge found that google had a monopolistic grip and in this particular instance were abusing it. It's fine to disagree with the judge or even these specific regulations but you obviously believe large enterties(such as the US government) should have restrictions placed on them to stop abuse yet seem to say a little later that large entities (businesses) should not have restrictions on them to stop abuse. I can't understand how this is logically coherent.
I'm also confused by your highlighting of the definition of the word monopoly, are you saying that equating governments to regional monopolies is a flawed analogy or are you just highlighting that one form of monopoly relies on legal enforcement and therefore pointing out that governments are monopolies. Maybe you are saying that google is not a monopoly in this instance, I'd be inclined to agree but would point out that "exclusive ownership through legal privilege, command of supply, or concerted action" as far as geographic data and infrastructure in place would be an arguable position. If you argue against that on the grounds that others could sink in capital to create there own method of supplying data, then I'd argue that the government is about equally removable in that the customers can vote for change (I to believe that's a joke just like your statement on how reliant the monopoly is to any given customer).
I'm distinguishing between a "monopoly" as is used commonly (and loosely) like in this case to describe Google and a true monopoly, which by definition no one is able to compete with equally, like the US federal government. I think that "monopolies" (Google, any entity that doesn't use the government backed by force to protect it from having to compete equally) are okay, but a monopoly is not, and is prone to corruption, thus our founding fathers' belief in limited government.
This isn't my disagreeing with the judge, this is my disagreeing with their right to try Google in the first place, a power which _no_ government should have: the right to try and punish someone for a future intention of exercising one's property rights. It is France's violation of these human rights which I find reprehensible.
Regarding "monopolies" having no restrictions placed on them, this is true in the extent that the government is concerned. The government should neither help nor restrain individual businesses, and should instead create an equal environment where property and contract rights are enforced, and companies are not found guilty of success by the greed of others with a government that sanctions such greed.
I highlighted the definition of a monopoly, because everyone is throwing that word around without any regard for its meaning. Google does not have exclusive ownership of maps through any legal sanction; It does not have command of supply as a Google map is a combination of bits and knowledge of information that is freely available to _anyone_ that would take the time and had the incentive to assemble them; There is no concerted action as there's no 2nd party with which Google has been acting with.
Finally, I never said a monopoly is beholden to _a_ customer, but instead to _its_ costomer_s_. A company in a free market cannot exist in perpetuity without providing some value for which someone will trade their money for. So long as both parties are free to trade value for value, no monopoly exists.
In a democracy, free markets don't make the choices. The people do.
And the means by which they do it is with their voice and their vote, not their wallets.
People are more than just consumers. Consumer behavior is driven by many other factors then what people actually want, and the free market does not necessarily reflect the will of the people.
Free will is more than just being able to decide whether or not to consume shit.
Then God bless that the United States is a Republic[1] and not a Democracy, such that my rights should never be beholden to such contemptible motives.
Also, this is a very materialistic view of money. You falsely assume that money's sole use is the acquisition of material goods, and not what it really is, the transfer of value.
Wealthy and poor alike choose to donate to and support causes they see as perpetuating their values. Are you really suggesting that an individual that wants for no goods to consume has no use of money? No.
What you are proposing is that to those who refuse, by virtue of their property rights, to give you what you want, you would take from them at the point of a gun upon non-compliance that which they would not give you. _This_ is the tyranny of the majority, a true democracy, a form of government our founding fathers held in disdain.
I suspect that you hold this view of money because you find that no amount of it would grant you the power to take that which you desire to obtain through a democracy, the violation of other rights.
Self-righteous indignation ahoy! We must have entered yet another ideal-free-markets vs. everything else discussion on Hacker News.
Frustrated as you may be that others don't share your ideals here, your entire comment is huge, deep red, herring.
And there is much more to monopolies than just 'success', you silly. Ever heard of the Microsoft tax? Every OEM was in a losing position if they dared to offer a non-Microsoft OS among their product lines, as they would be sold their licenses at a higher cost (i.e., not at a monetary discount resulting of a virtuous association between entrepreneurs) than every other player in the game.
Thus, even if there was demand for alternatives, if it didn't overtake the loss incurred by higher cost-licenses then it wouldn't be viable to offer say, Linux machines.
I don't expect anyone to share my values, nor do I care if they do for the sake of the argument, as you'll note below where I went out of my way to thank @arg01 for his reasoned argument.
You probably won't like this, but those businesses existed because of what Microsoft created and it deserved to charge whatever it liked to its customers. We are speaking here of rights, not virtues or morality, so you'll find my "self-righteous indignation" to be in short supply. Just as Microsoft was free to charge what they liked for the fruits of their labor, OEMs were free to not attempt to profit off a product Microsoft created. Microsoft made its money from selling software, an intangible thing of no value without hardware to run it on. Those OEMs existed because they were able to create hardware better than Microsoft. Obviously though, it was Windows that was of more value (more difficult to create) of the two, which is why Microsoft held more leverage. This is a _good_ thing to have success rewarded.
No company has a right to profits. In a free market they must compete by the merits of the value they offer to free men.
Doesn't this assume users have no choice? If a better map product came along, couldn't they also make it free (to compete with Google's future raised prices) and then when Google is bankrupt, raise the price? Isn't this totally ignoring the business model and claiming a monopoly on price alone? What's the barrier to entry? Is Google blocking competing map provider's search results?
Even if Google doesn't start to charge high fees once the others are driven out of business, it would still be bad for the industry. Since no one can compete with Google's deep pockets, they have a monopoly on any improvements, changes. The barriers to entry are high; raw mapping of large land areas is hugely expensive and complicated. So the industry would shrivel as a result.
I think in most places Google licenses mapping data (usually you can see the credit in a watermark somewhere on the map).
So I'm not sure that argument works - Google is paying for the data like everyone else. The problem is they were giving the service (curated data) away.
This has nothing to do with the free Google Maps but instead the use in Enterprise which normally carries a hefty price tag. Software products do promotions all the time - it's still up to the user to decide whether the future costs of the software/updates are worth it.
Maybe it's a little unfair to the smaller players but illegal? I see it as a promotion to get the Enterprise version some extra users and increase publicity. It's competition. Google can afford to lower their price or give it away free to gain customers, this is bad? What if their promotion didn't give it away but went half price? 1/5th price? Who decides what level Google can cut their price as a temporary promotion?
Some people should actually read the court arguments before post,
the French court didn't just applied the fine, it was based on Google acts: when all other competitors dies google will start charging... with low price rates.
is it fair?
1. Start a Youtube competer that charges money for uploading videos.
2. Sue Google for providing this for free
3. Profit???
But seriously the french authorities are either corrupt or morons, or maybe both, Google has another business model, Google does not want to sell Maps as a service(not talking about the API) it wants to sell ads, big difference. Basically Google gets punished for having a better business model.
This seems ridiculous if it is the free version of the Google Maps API. But, if Google is offering the paid-for Business version of the API for free, then Bottin has a case. I don't see it stated anywhere if the case specifically targeted the free or business version of the API. Does anyone know?
Would a company get convicted under the same law if it was backed by an entity with unlimited (a lot of) cash and gained a dominant position because of the backing entity?
I'm not defending Google, just wondering if the case I describe above is the same as what Google was doing?
One minute we hear people complaining that Google Maps cost too much money (if you have heavy volume) and next we hear that Google Maps cost too little money.
I don't know if Open Street Maps will be that successful in France though... If you plot the density of documentation in en.wikipedia on a map, you see a hole where France is... Germans, Dutch and English like to participate in free culture and open source -- I don't know if it's a language problem or if the French are too smart for that and will only work on something if you promise them a pension first.
I just created an account to reply to this... because I think your method (plotting density of en.wikipedia on a map) might be flawed. Not being French (or living in France) myself, I happen to be aware of the fact that they tend to do a lot of stuff in, well, French. Just saying - maybe plot fr.wikipedia on a map and compare to ge.wikipedia and es.wikipedia and then we will have some interesting data...
You wouldn't switch to the new world domination lingo as easily, if you already spoke the old world domination lingo, right?
Europe has loads of nice things. You should visit sometime.
This ruling, presumably, is about a big company subsidising its unprofitable mapping business with another part of its business until the small fish die.
> Europe has loads of nice things. You should visit sometime.
HN is not a place for flame wars about countries (or continents). He had a valid point, as he was referencing the hostile legal climate for doing (some kinds of) business in several European countries (and in some cases the EU).
There's no blanket prohibition on offering things for free that cost money to develop. There are free French search engines and newspapers with free websites, for example, as well as French companies that develop open-source software. A court would have to find that the free service is being cross-subsidized and offered at a loss for the purpose of driving competitors out of business, to later profit from (http://en.wikipedia.org/wiki/Predatory_pricing). That's also illegal in the U.S., but U.S. courts tend to require a higher bar to demonstrate it.
But if Google actually "killed" all the competition and started charging what would prevent someone else from coming in and undercutting Google? In technology if there is an opening there is always someone waiting to fill it (I know Apple is interested in the space). Also there will always be a need for low price and high price options (iPad / Kindle Fire) If what you're offering is worth the price that you charge then you should not have an issue finding customers.
P.S. I would be more surprised if this were a US Court.
No google has been found guilty of not being a French company - or not employing the right grads from ENA whose "Papa" went to ENA with the right people whose "Papa" also went to ENA
Same way it was the was non french companies that got raided over the 35 hours working time laws
Do you think that in a market for a service which is very expensive to provide, one participant offering that service for free will encourage competition, or will it drive the others out of business? If you agree that it will drive them out of business, then you agree that offering the service for free is anticompetitive.
The situation here is more complicated than that, and not all anticompetitive action is not illegal, but I don't think you actually believe that offering a free service can't be anticompetitive.
(deleted my OP due to people using the down arrow for "disagree")
>Do you think that in a market for a service which is very expensive to provide, one participant offering that service for free will encourage competition, or will it drive the others out of business?
I'm sorry but I'm finding it very hard to justify the government stepping in and saying "Nuh-uh, you're not charging enough". If this was a case of predatory pricing, whereby they're trying to just drive everyone else out before jacking the price up, that's one thing, but having a free service? My mind is boggling.
They are being forced to set a price higher than they want (or need) at gunpoint. So what is the price they should set? Who decides that, and what legal precedent is there for it?
This isn't a free service, though; this is a temporarily-free version of their Enterprise API, which they plan to charge (a lot) for later. I.e. they precisely are trying to drive everyone out of business before jacking the price up.
That's only the allegation by the cartographer company, it's not proven, and it really reeks of thought crime. (How can you be sued for something you "plan" to do with no proof of such a plan?)
And as the article says, that is NOT like Google at all.
And another thing, is that the service who is doing the whining here is quite objectively crap, compared to google maps.
Initially free services that later have the prices jacked up seems to be pretty in character for Google. See, e.g., App Engine and the translation API.
I actually have some sympathy for companies that are working solely in an industry like cartography, that have Google come in and offer the same service for free.
Yes, on the one hand, it forces the competitors to develop better products and justify charging for them. But on the other, Google is clearly using their billions made from search advertising to dominate another unrelated industry.
It was wrong when Microsoft did it, it's still wrong when Google does it.
>But on the other, Google is clearly using their billions made from search advertising to dominate another unrelated industry.
That would hold water if the products they were "dominating" were competitive in any way, shape, or form. The competition frankly sucks. I'd believe Google was killing them if they weren't busy killing themselves by offering a completely and totally inferior product at a much higher price.
That move in itself is what contributed to the ruling. OSM is free for everyone. It is a wiki. If OSM destroys google, bing, etc, and then decides to go on a charging spree (it can't) then it would also face similar decisions.
Kudos to the french for this.