USDOJ Sniffing Google Antitrust Suit, Hires Ex-Disney Lawyer

Van Cutter Romney was one of several to write with the story that "The Justice department has secretly hired former Walt Disney lawyer Sanford Litvack for a possible antitrust suit against Google. As reported earlier, the Justice Department is investigating the deal between Google and Yahoo which accounts for 80% of online search advertising. The Wall Street Journal writes today that Justice Department lawyers have been deposing witnesses and issuing document subpoenas for weeks — but that doesn't necessarily mean a case will be brought."

Comments

I thought Google is competing with Microsoft

[CrazyJim1]

And every Tom, Dick and Harry who creates webpages. Oh and Google is competing with Verizon and AT&T... Maybe because Google has so many competitors that the competitors are trying to indirectly litigate.

I'm not quite a Google fanboi, but I can't figure out how Google is stopping others from innovating.

Re:I thought Google is competing with Microsoft

[hedwards]

This isn't baseless or in any way shape or form non-obvious, I've been expecting this to happen for months. It's a matter of history repeating itself. The same thing happened to MS at approximately this point in it's history. Google has enough power via information and access to information that it was only a matter of time before there was an investigation.

I wish I could have given you a +5 tinfoil hat, but seriously, the DoJ is supposed to look into these things. The DoJ happens to not have jurisdiction in either Iraq or North Korea. And not even Iran is under the jurisdiction of the US DoJ.

MS wasn't completely ignored, sure they weren't taken to task as much as they ought to have been, but they weren't just let off the hook. More likely than not Google will end up with a similar arrangement after all is said and done.

Re:I thought Google is competing with Microsoft

[Korgan]

Surely there is a difference here in that Google's so called Monopoly is borne of natural migration. People use Google because its better than the other options. Yahoo had its opportunity in the 90s and even at the beginning of this decade and did nothing. They could even have *bought* PageRank when Page and Brin first made the sales pitch to them.

Microsoft is no different in that regard. If it hadn't been too busy looking at AOL and CompuServe and trying to reproduce it with the original MSN, the could have gotten a head start. Instead they're at least half a decade behind everyone else and only making ground by tying their online products into their offline products (Look at MS Office 2007 running on Vista for an example.)

Google created a better product and captured the market share naturally. There is absolutely no impediment to people switching from Google to Yahoo's Overture (or whatever they call it now) or MS AdCenter. In fact, Google make it damn easy for you to get your information out of any of their products to take it to another company. From GMail (and Google Apps) all the way through to their AdWords platforms.

While the DOJ may have an obligation to investigate a monopoly, they cannot rightly charge Google with any anti-trust violations given it does not impede people leaving and the marketshare it has was generated simply by having a better product. They have not in any way used that dominance to force people to only use their product at the expense of others.

Remember BeOS vs Windows 98?

If anything comes of these investigations, it will be a very dark day for the so-called Justice system in the US.

So, lemme get this straight...

[R2.0]

1) Google proposes deal with Yahoo.
2) Federal Trade Commission, the government entity charged with regulating business activities vis a vis anti-trust regulations, gives the OK.
3) Google goes through with deal
4) Justice department investigates for anti-trust violations.

Why does this remind me of when the Big Three were getting sued for the type of airbags that the Feds REQUIRED they install, and not having switches to turn them off which they were prohibited from installing by the same regulations?

Re:So, lemme get this straight...

[jcr]

You've got it straight.

In many ways, it sucks to try to do business in this country, particularly if your company is big enough to plunder.

-jcr

Re:So, lemme get this straight...

[jollyreaper]

1) Google proposes deal with Yahoo.
2) Federal Trade Commission, the government entity charged with regulating business activities vis a vis anti-trust regulations, gives the OK.
3) Google goes through with deal
4) Justice department investigates for anti-trust violations.

Why does this remind me of when the Big Three were getting sued for the type of airbags that the Feds REQUIRED they install, and not having switches to turn them off which they were prohibited from installing by the same regulations?

Oh, I think it sounds more like Google not paying up to the appropriate parties, now here's the threat of something unfortunate happening to their business. Note that Microsoft got off on the anti-trust charges after the bushies came in.

Re:So, lemme get this straight...

[sp3d2orbit]

This whole thing sounds like something out of an Ayn Rand book.

When do we get the Equalization of Opportunity Bill?

Re:So, lemme get this straight...

[recharged95]

5) Google makes money off deal.
6) US Gov't makes money from [winning the] antitrust case.
7) Lawyers on both side win. (cause lawyers ALWAYS win).

I see a win-win for both sides. Well, except for the consumer/taxpayer....

Wierd theory here

[Coraon]

Could it be that other are having trouble competing with Google because everyone else has lost touch with their user base but google? The only reason I use google search is because how fast it loads, their main page isnt bogged down with crap that takes time to load, it just loads. If one of the big three had been smart enough to know that the hard core among us just want efficiency and we are the ones that provide word of mouth then they would be a lot better of. Google doesn't prevent competition, it just does things better then the competition.

Re:Wierd theory here

[moderatorrater]

Let's not forget that there's no more open and free market than the internet. I can load up cuil and use it all day long if I want to, and any website can go to any ad service they want to. As a matter of fact, you'd have to go to MSN to get an ad into Facebook. There are so many ways to compete on the internet and they cost next to nothing. Now, if Google starts offering discounts for people who only use adwords, then there might be an issue. However, as far as I've been able to tell, they don't, so what's the problem?

They didn't hire him.

[Anonymous Coward]

They didn't hire him. He's on loan, to return the favor for passing legislation that favors Disney (for reference, see all the latest copyright changes influenced by Disney).

This will mean nothing in the end

[mangu]

FTFA:

a federal antitrust case against Google could set new boundaries for Internet competition, much as the Justice Department suit against Microsoft Corp. a decade ago broke ground applying antitrust law to new technologies

Yes, and we all know how much that decade-old antitrust suit changed the world...

Re:This will mean nothing in the end

[malkavian]

Actually, it changed the world a lot.. The world used to believe that the US actually had shreds of decency and fairness left in its legal system, and hoped that perhaps the people had a say in their Government, rather than it being owned by the Corporates.

I don't understand antitrust suits

[Van Cutter Romney]

I get the part that Google is monopolizing the online advertising space. But that is no reason to sue them. It's true that they set a high bar for entry into the market and they will continue to do so as long as customers flock to them.

The only reason for an antitrust suit would be when the company stifles innovation. But if it does customers will automatically move away from them and move to others who have better services. That's simple economics. DOJ doesn't help the process in any way by suing Google.

Re:I don't understand antitrust suits

[SirGarlon]

The only reason for an antitrust suit would be when the company stifles innovation.

You seem to be confusing "innovation" with "competition." They're not the same, and one does not imply the other.

Re:I don't understand antitrust suits

[nickspoon]

That's simply because they don't. They have a small, text-based advertisement for the Google Chrome beta on their front page, something which they are perfectly entitled to have, in my opinion. They do not bundle Chrome with their products; you are not required to have Chrome to use Google Search, Maps, Earth or anything at all. You are not constantly pestered to install Chrome or hampered by User-Agent restrictions.

Microsoft, on the other hand, bundle Internet Explorer with their operating system. You have one, you get the other - and they're inseparable. A number of products, Microsoft and otherwise, have a dependency on IE to function - most of those are built using MS developer tools which utilise that.

There is simply no comparison to draw.

Big difference

[stox]

I have not heard of Google abusing its market position like Microsoft.

Re:Big difference

[Prof.Phreak]

I have not heard of Google abusing its market position like Microsoft.

They're making it difficult for mediocre companies to compete, damn it! In fact, the Fed should step in and use tax dollars to help those companies compete. Or use legislation to make Google less competitive.

Re:Big difference

[snl2587]

Although one could argue that releasing products for free was akin to underselling the competition, driving other companies out of business by funding these products with alternate revenue streams. Not my opinion, but I can see where they are coming from.

I'm also getting the feeling that this is nothing more than a probe. I guess time will tell on that one.

Re:Big difference

[ClosedSource]

Because IE never locked its customers out of competitors' sites. Which is why all the legal wrangling over IE bundling was a big waste of time.

Inevitable

[EvilIntelligence]

This was inevitable. Eventually, Google was going to take some steps forward in some area, and somebody was going to panic that it was a "monopolistic" move. Any sufficiently huge company has to deal with that (even Disney had that problem years ago). It will be interesting how it plays out, however. Antitrust suits usually hinge on making sure that the customer is not ripped off. In this case, the customer is not the end-user who surfs the web. The customer is actually the advertiser, since that is where these guys make their money. And the advertisers can still advertise on both Google and Yahoo equally and increase visitor coverage, so it will be hard to prove that the customer has suffered damages.

yeah, ok.

[SCHecklerX]

How about they fix the M$ problem first? How many companies were destroyed before Linux got a foothold back in the late 90's?

Re:Who didn't Google pay off?

[smclean]

So who did MS pay off but Google not get to?

Ah, but the case is young!

Google is not a monopoly.

[TechnicalFool]

Google are virtually omnipresent because they are just that good. Nothing and nobody is stopping you or anyone else from trying to compete with them, as seemingly impossible a task as that may be. They don't own a patent on the search engine.

Unlike a certain large OS vendor whose business model revolves around finding new ways to lock customers in, turn open standards into proprietary, patented and licensed rip-offs, and threatening others with lawsuits whenever it feels the need. 235 patents, wasn't it?

Lost touch with user base?

[EraserMouseMan]

Yea, Google has a stranglehold on Internet search and therefore is in touch with their user base.

MS on the other hand has a stranglehold on the desktop OS and therefore is an evil monopoly.

Let's face it folks here's the only difference:
* Google's monopoly will hurt businesses wanting to buy web ads.
* Microsoft's monopoly will hurt individuals who use desktop products.

It just depends on whether you are a business or an individual as to which monopoly you'll feel stung by.

Re:Lost touch with user base?

[EvilIntelligence]

Please do not confuse market share with monopoly. Microsoft has the majority of the market share of the desktop world. But that is not what makes them a monopoly. Where they can be deemed a monopoly is using their position of dominance to suffocate other competitors, such as forcing computer manufacturers to install only Microsoft Office products under the threat that if they don't comply that Microsoft will yank their Windows licenses. And of course any desktop manufacturer that can't include Windows can't sell desktops. The Google/Yahoo thing MAY be different. So far, Google has not shown that it is using its dominance from forcing an unfair anti-competitive edge against its rivals. That is a huge difference.

Re:Lost touch with user base?

[Chyeld]

Monopolies are not evil. They are not illegal. They aren't even unethical.

Hershey's has a monopoly on Hershey's branded candy. Apple has a monopoly on iPods. There are plenty of companies out there that make the only one of whatever they make.

Anti-trust (actually more appropriately titled 'anti-competitive') legislation isn't designed to prevent monopolies; it's designed to prevent someone using their monopoly in an anti-competitive manner.

For instance, if you or a group of companies working together control the manufacture and sale of almost all the widgets in the world, use that to set prices (you'll sell our widgets for $20, period, or you won't sell them at all) or to prevent anyone else from getting into the business (buy from our competitor and we'll never sell you another widget again), that is a felony in the USA.

In general using your monopoly to restrict another's business is considered anti-competitive and in most places illegal.

I've yet to hear of anything Google has done that could be portrayed as this, on the other hand Microsoft's entire history has been littered with attempts to pull this off.

MS attempted to force retailers to sell Windows only if the customer also bought MS-DOS. When that failed and they were forced to sign an agreement to never bundle their products again, they released Win95 and lied about MS-DOS being integrated in. The integration was just a checksum against your installed DOS version which refused to let Window start if it wasn't the right version. Years later someone released a patch to remove that check and discovered Windows ran just fine with other people's versions of DOS.

MS stole the code to Stacker, and packaged it in Windows to prevent other companies from entering the disk compression market. And later they attempted to use the monopoly with Windows to force their competitors in the web browser and media player markets out of business.

MS attempted to maintain their monopoly by forcing PC makers to install Windows on all their computers (those that didn't were faced threatened with steeper prices or simply a refusal to sell).

Again, I've yet to see anything Google has done that follows those lines.

Re:Lost touch with user base?

[RulerOf]

That's exactly like the monopoly banks have on electronic transactions through VISA and Mastercard.

10 years ago, you could do a debit transaction to pay for things with a card at a store... but that was bad, because it costs you money.
Now, you can do a credit transaction to pay for things with a card at a store... but that is okay, because it costs businesses money.

People would be all upset if they had to add $1 to the cost of every purchase they made because they used the debit system to pay for things... meanwhile, they utilize the VISA and Mastercard systems, which costs every business they visit an extra fixed rate or percentage... which gets passed on to the consumer in the form of higher prices.

If only people could stop buying coffee with plastic.

Re:Finally

[JStegmaier]

I think you might be a little confused. The AT&T today is one of the pieces that broke off. However, it is also the piece that owns all the other pieces, except Verizon.

To summarize: DOJ breaks AT&T up, FTC let's them get back together.

In this case, the FTC let's Google and Yahoo get together, now the DOJ is considering breaking them up.

Google's ahead because they're better

[billstewart]

Google became the dominant search engine for a couple of reasons - not only is it really fast and uncluttered, compared to some of its early competitors (remember Hotbot?), but PageRank did a good job of guessing what pages would be the most relevant and most interesting and displaying them first, and nobody's really caught up with them. On the other hand, they've still only got a bit more than 50% of the market - their two main competitors are staying in business.

In advertising, which is how Google makes most of their money, Google ads are uncluttered and fast, so they're not as annoying as other ads, making web site authors more willing to carry them, and apparently advertisers think Google does a good enough job of targeting ads to readers that they're more effective than their competitors or have a better price per result or something.

And unlike Microsoft, where the tight integration between the OS, device drivers, the mail system, the calendar, and Office makes it difficult to leave once you're addicted, it's easy for anybody to use another search engine instead of Google, or for an advertiser to use a different ad agency, and the reason Google stays on top is because they invest enough development money to keep their quality high.

Hmmmm.

[WindBourne]

It is NO co-incidence that Microsoft is one of hte top corporate donors to the Republican party. They scratch each others backs regularly.
I am absolutely not a fan of MS, but you must know something that others do not.

Just a thankyou notice

[TechnicalFool]

For being someone else in this thread to spot the difference between popularity and monopoly.

Ta muchly.