The products and services offered by Google are well known and highly regarded. Every day, millions of consumers around the globe visit the company’s search engine or sites like Google News or YouTube. And for this, the company’s employees and (especially) its founders have been well compensated.
But there’s another side to Google that consumers know very little about. That is Google the corporation, and the effect its business practices are having on competitors, and most dramatically on the professional media, news and entertainment alike.
In important measure, people know little about Google the corporation because news stories and commentary about the company’s business practices are mostly confined to industry trade publications, or technology and economic journals.
Even the public policy issues that the company addresses are complex, and hard to write about in a way that wouldn’t cause most readers’ eyes to glaze over. How, for instance, would one popularize such issues as the district and appellate court rulings in Viacom v. YouTube, or the FCC’s “network neutrality” proceedings, or the FTC’s recently concluded investigation of Google’s search and advertising policies?
So it’s easy to understand why the public at large doesn’t know much about Google’s role in these matters, but book and newspaper publishers do. So too do movie studios and Google’s competitors in the online travel business, to name just a few.
And what all of these other companies know is that Google’s scale, business tactics, and aggressive lobbying amount to a distinct threat to their very existence. A single datum provides a startling view of the challenge: Through the first half of 2012, Google by itself took in more ad dollars than the entire U.S. print media, magazines and newspapers, excluding only the ads on newspaper websites, which even today generate only about 25 percent as many ad dollars as print advertising.
The ways in which Google uses its dominance in search to monetize, by corralling and aggregating (without permission) the content of others, is a story that is long in telling. But a common feature, as stated in a White Paper submitted to the FTC in 2011 by The Media Institute, is that Google’s “main search page biases Google News results over results of news organizations and other publishers.”
Nor is this the perception and complaint just of American publishers. On June 25, a coalition of hundreds of Europe’s leading publishers urged the European Commission, which is the EU’s antitrust authority, to reject outright some remedies that Google offered to end an investigation by the Commission of the same kind of practices the company is accused of by publishers on this side of the Atlantic.
As summarized by GigaOm, “Google is accused of surreptitiously favoring its own services in its search results, locking advertisers onto its platform and scraping content from rival, subject-specific search engines.”
In elaboration of the European publishers’ rejection of Google’s proposals, the president of AEDE, a Spanish association of daily newspapers, put it this way: “In short, Google’s proposed remedies do not address the overarching problems and fundamental harms that Google’s conduct causes in search-related markets and none of them aims at restoring effective competition…. In some ways, they might actually make matters worse by entrenching dominance and misleading consumers.”
Here, as in Europe, the principal venues of appeal for those being harmed by Google’s business practices are the antitrust authorities, which is to say quasi-political bodies. And that’s a problem. In this country, the FTC has already dismissed an opportunity to do a full antitrust review of Google, in part, we can speculate, because there is no great public support for the news media generally.
Indeed, a Pew poll, released on July 11, found that only 28 percent of respondents believe that journalists “contribute a lot,” down from 38 percent four years ago. And a Gallup poll, published on June 17, revealed that only 23 percent of the public have “overall confidence” in newspaper and TV news.
Given this lowly rating by their own customers, one might be tempted to dismiss the news media’s cannibalization by Google as something they had coming to them, and there’s an element of truth in that, as with the special contempt for them that the media have inculcated in conservatives and Republicans.
But there’s a much larger issue involved in Google’s anti-competitive behavior, and that is whether this (or any) country will in future have a robust and profitable news media industry, marked not by opinion but by objective news, investigative, and feature reporting. Surely people of all political persuasions can agree that blogs and content aggregators are not going to fill that role.
At a time when the Internet is obliging mainstream news outlets to publish online, it is not yet clear whether a way can be found to make up, in that process, for the necessary advertising revenue that once came their way – a problem not confined just to the legacy media but to prospective newer entrants in the news reporting business as well.
And it is at this crossroad where Google, the company whose fraying motto is “Don’t be evil,” may prove decisive.
The opinions expressed above are those of the writer and not of The Media Institute, its Board, contributors, or advisory councils. This piece was first published in USA Today on July 19, 2013, under the headline "Beware of Google's Power."