It was not going to be a good day for Google (NSDQ: GOOG). There is nothing positive about having your former CEO dragged before attention-seeking politicians while competitors crow that you’ve grown too big for your britches. The best the search giant could hope for was that Eric Schmidt did not make any unforced errors and that it would be able to control at least part of the ensuing media narrative. By these criteria, Google’s bad day before the Senate could have been much worse.
As I reported earlier, the purpose of the Senate hearing was more about theater than about whether or not Google is tweaking its results to downgrade competitors in the travel and restaurant review market. The Senators played their parts well and delivered some gems. Here are two, courtesy of the LA Times:
“You run the racetrack. You own the racetrack. For a long time, you didn’t have any horses. Now you have horses … and your horses seem to be winning.” Sen. Richard Blumenthal (D – Conn)
“When I see you magically coming up third every time … you’ve cooked it so you’re always third.” Sen. Mike Lee (R – Idaho)
There is no hard evidence yet that Google does in fact, cook its search results, but the Senators’ allegations must make the company uneasy. Google fears that it will be forced to disprove their claims by revealing its search algorithms. These algorithms are the company’s most precious trade secret — and something Microsoft (NSDQ: MSFT) and others would dearly love to see.
During the hearing, Chairman Eric Schmidt not only avoided any Bill Gates’ type mistakes but also got some media traction for the counter-narrative that Google is putting forth to make the regulators go away. Under this narrative, Google is a humble company that will not turn into a monopolistic bully. The firm has to be pleased that the press gave prominent play to Schmidt’s line of position:
“We get it [...] we get the lessons of our corporate predecessors”
Schmidt was also effective in reminding the committee that Google is both a jobs machine and popular with many Americans (read: the voters like us, so keep your regulatory hands off us).
It will take weeks to determine which of these narratives will take hold — that of sinister monopolist or the humble beloved tech giant. In the meantime, Microsoft and others will continue to throw around new antitrust allegations (like this one in Business Week) while Google pushes on with its charm offensive. For now, Google can be thankful that’s the grilling is over and that it didn’t take any real hits in the image department.