Google, this is why you’re under investigation

Dick Dastardly

Dick DastardlyIt’s hardly a secret that most big businesses hate regulators. They’re often seen as cartoonish villains, meddling in the affairs of others to satisfy their own (bureaucratic) agendas rather than serve the interests of ordinary people.

Sometimes that’s accurate — though not always. Take, for example, the decision last year by European officials to launch an antitrust investigation into Google. It was met with howls of derision by those who felt that it was sour grapes from competitors (including Microsoft) or simply a misguided attack on a hugely successful foreign company. Those concerns were exacerbated even further last month when the U.S. Federal Trade Commission decided to start its own inquiry, with a confidence no doubt spurred on by Europe’s actions.

It’s easy to dismiss the claims against Google as carping by rivals. But for anyone who thinks the EU investigation isn’t warranted, here are a couple of data points worth thinking about.

First, figures from Hitwise suggest Google now accounts for 92 percent of all search traffic in the U.K. That’s an all-time high for the company, signifying complete domination of the market. The figure is actually higher in some other European countries, and significantly more than its North American market share. Google dominates the European market to a degree that is far greater than its successes at home.

Elsewhere, it emerged over the weekend that the Belgian newspapers locked in a dispute with Google were back in conflict again. A consortium known as Copiepresse famously filed a lawsuit against the company in 2006, claiming Google News should not excerpt their articles without permission or payment. The news group won the case, eventually, but it was pretty acrimonious. Now, however, it appears Google is playing hard ball again, saying in order to comply with the court’s wishes it has to remove Copiepresse entirely from its index.

So that’s erasing Copiepresse not just from News, but also from the main Google search engine, too.

Google spokesman William Echikson said the court decision applied to web search as well as Google News and the company faced fines of 25,000 euros ($35,359) per infringement if it allowed the newspapers’ websites to keep appearing.

“We regret having to do so,” he said. “We would be happy to re-include Copiepresse if they would indicate their desire to appear in Google Search and waive the potential penalties.”

Copiepresse argues it’s a willful misreading of the court’s decision and it’s being punished by Google for standing up to it. Whatever the case, it’s yet another mess caused by Google’s power.

Of course, it’s worth pointing out that it’s entirely possible to become totally dominant in a market through simply being better than anyone else. But it’s also worth saying that being investigated by a regulator doesn’t mean the same as being found guilty by them. When it comes to government regulators getting involved in technology businesses, though, the question is not whether it’s possible to control a market — it is whether it’s healthy. And that is less obvious, and therefore why an investigation on both sides of the Atlantic may be necessary.

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