Comment by nivla | Hacker News Reader

Comment by nivla | Hacker News Reader

In this thread a lot of people don't understand the meaning of monopoly and assumes a monopoly is only synonymous with the companies they hate. It has more to do with having a dominant control over a market and abusing that dominant position to own advantage. Google has pulled a lot of stunts in the past that clearly defines this. Remember the only way to have pictures on your search listing was to link your blog/site with Google+? A result with an image next to it had better clicks that the one without. Next was the shopping fiasco: The shopping results that shows up on the top had barely anything to do with ranking, instead it was a set of sponsored listing that was paid for by companies. Hmm the blending out the background of the ads with the rest of the results is another story of its own.

Although my primary search engine is still Google (like the majority here), I still don't agree nor do I encourage the direction Google is taking with their search engine.

One of the primary characteristics of a monopoly is high customer switching costs. For example, a business running on the Microsoft platform in 1995 could not realistically switch to Apple, Solaris, etc. During the heyday of Standard Oil, you could either buy from them or find a way to get your oil shipped from overseas. If you didn't want to use AT&T in 1975, you'd... uh, have to work at the speed of telegrams?

Meanwhile, if someone builds a better search engine, all of Google's customers could switch to it in ten seconds and never look back.

High switching costs can make monopolies worse. And yes, it is possible to switch away from Google search. But it's still a monopoly, and it's held in place by various means.

For example, the vast majority of people - not tech people like us - do think that they can't switch away. They don't understand the distinction between a web browser, a search engine, email, etc. For them, Google is how they access the internet, and that means google.com, and often also means Chrome and gmail.

The monopoly is also held in place by Android, which defaults to Google services (search, email, etc.) very strongly. Of course, us tech people know how to avoid that if we want, but the majority of people don't even know they can. And even if they do, it's not easy for them.

And Windows defaults to IE and Bing search. I don't see any antitrust case against Microsoft for essentially the same thing you are describing.

Or Apple and Safari.

There was a successful antitrust case against microsoft because of the way they abused their OS to get browser share with IE. I believe that the case was mostly because MS purposefully raised the switching cost by adding non standard features to their browser.

A bigger part was OEM licensing restrictions that prevented other browsers from being pre-installed.

There isn't a single default search that's Google on any OS besides Safari on Apple and Android. Windows defaults to bing, Linux via Firefox defaults to Yahoo. People CHOOSE to use Google. No one is forcing them.

Google is paying Apple billions to be the default search engine on iOS.

I am sure a two person startup can do that. /s

I don't understand how this reply is in any way relevant to its parent comment.

It is countering your assertion that switching costs are low. It is not easy for a new player to enter the market on an equal footing with Google.

The difficulty of a new player entering the market has nothing to do with end-user switching costs.

There are also high barriers to entry if you want to start a cola company with worldwide distribution, but that doesn't mean Coke has a monopoly.

See you are arguing that only a monopoly is illegal and unethical. Fact is, there are forms of non monopolistic market manipulation that are illegal. In the US, you can't form cartels or segment markets by colluding with competitors. Similar laws apply in Europe.

> See you are arguing that only a monopoly is illegal and unethical.

No I'm not; what gave you that impression?

So why argue about what makes a monopoly?

There is a lot to unpack here.

>One of the primary characteristics of a monopoly is high customer switching costs.

The algorithms are of no value and can be duplicated by anyone. The real value google has is the search click data, which can't be obtained or generated. So yes there is actually an extremely high barrier to entry.

>Meanwhile, if someone builds a better search engine, all of Google's customers could switch to it in ten seconds and never look back.

Well, no, because Google's customers are companies. The users are not the customers. The companies will go where the users go. How do the customers take their advertising data to the new search engine? They cant. Also, building a better product matters only sometimes. "Better" here implies that users are rational and are capable of evaluating competing products. If that were the case most companies would be out of business. Thankfully it isn't. Ironically, I suppose there is _some_ hope. Not by building a better product, but using either trends/fads/viral memes/ or pure marketing or other means of attracting users. But yeah, probably several hundreds of millions of dollars would be my guess.

> Meanwhile, if someone builds a better search engine, all of Google's customers could switch to it in ten seconds and never look back.

Google's customers are advertisers. Someone would have to build a more effective advertising platform to get Google's customers to switch.

And that new platform would have to collect and analyze even more product (a.k.a. users) data, which would likely be an even greater perceived invasion of privacy.

https://news.ycombinator.com/item?id=12096168

>> if someone builds a better search engine, all of Google's customers could switch to it in ten seconds and never look back.

The point here is not that Google is a monopoly, rather that it's treating its competitors unfairly.

The fact that Google has competitors indeed means the "only shop in town" excuse holds no water. Google does have competitors, except they're not in the search business, they use Google's search business. And Google uses this fact to put them out of business and take their customers.

Also- just because you don't have any options when someone puts a gun to your head doesn't mean it's fair for them to do so.

Antitrust law is emphatically about what's best for consumers, not what's best for competitors.

Healthy competition is best for consumers, and a free market is paramount to this... being able to abuse a dominant position to gain dominance in new markets is anticompetitive and bad for the consumer long term.

Now, a single competitor should not necessarily have a leg to stand on, but the acts of a first party like google have sweeping repercussions.

> all of Google's customers could switch to it in ten seconds and never look back.

Google's customers are all the businesses buying ads from Adwords.

And yes, Google is a monopoly, the cost of switching away from Adwords will probably drive you bankrupt in 2016.

> In this thread a lot of people don't understand the meaning of monopoly and assumes a monopoly is only synonymous with the companies they hate. It has more to do with having a dominant control over a market and abusing that dominant position to own advantage.

No, it just has to do with the former (usually defined through possession of pricing power, which is very hard to argue Google has in many of the free services in which it is dominant.) The latter is abusing a monopoly, not having one.

> (usually defined through possession of pricing power, which is very hard to argue Google has in many of the free services in which it is dominant.)

They can dictate AdWords pricing though, no? And where else are you going to go? Bing?

> They can dictate AdWords pricing though, no?

Perhaps; they certainly have a very large share of search advertising and its a paid market, but whether they have pricing power is a fact question that I haven't seen strong reasons to believe either way on. Its pretty clear that there are competing places for online, even search-specific, advertising, and that firms make cost-benefit considerations in choosing these; its not clear to me that there is any range in which Google can increase AdWords prices without losing some business to its competitors, even if AdWords is so attractive at its current price point that it draws the vast majority of spending.

> They can dictate AdWords pricing though, no?

It's an auction model. The buyer literally sets the price.

And Google dictates the rules of the auction marketplace.

In a way that has never been suggested to harm consumers or be even remotely anti-competitive. So your point being?

Point: Google is a monopoly. I don't believe enough research has been done to decide if they've used their monopoly in an anti-competitive manner.

Interested to see what the EU conclusions are.

> And Google dictates the rules of the auction marketplace.

Every company "dictates the rules" on which its sells product. Pricing power -- the key test in antitrust for a monopoly -- requires that they be able to change those rules so as to raise prices within some range without business moving to alternatives; in the case of AdWords, it would mean that Google could make it more expensive for the same results without any net migration to any other advertising vendor.

Is that the case? I don't see compelling evidence either way.

We live in a world full of many pressing issues. My google results page is not one of them. What I'd like to know is - how did these regulators prioritize their backlog in such a way that this is the current priority - and everything else is a lesser one. That process is what's broken. Not Google.

This is exactly the same argument as "Why go to space when there are starving children in Africa."

The people who distribute food aid are generally not mostly astronauts. Europe's economy is not without serious problems, yet the same people who would otherwise be charged with considering those instead busy themselves with critical study of search results. That doesn't seem to be exactly the same situation.

The people responsible for the economy are not the same people responsible for regulations.

Did you ever think one of the reasons for the problems could be big companies acting unethically?

What's your point. That space exploration is in principle a good investment? That investing in lowing the cost of living is a bad investment? You're a little sparse on details.

Well, they're also researching other stuff, but Google, for example, saying "you can't have yahoo ads on a page with AdSense ads or YouTube embeds" was kinda problematic.

Luckily, that stopped a few years ago, yet it was still very crazy.

What dumb argument is that? If Google is allowed to just display whatever the fuck they want, then they could easily obliterate the economy of whatever country you reside in. Yes, as long as they don't abuse that, there is no problem, but that's not a reason to not have a law.

Whoa dude. Take a breath and maybe explain your argument in a little more detail?

If Google is allowed to display whatever they want they can obliterate your local economy? Details please..

Not sure what you need an explanation for. By now a quite significant portion of internet traffic is delegated over Google and a quite significant portion of commerce depends on the internet.

Google could decide to suddenly stop displaying links to the webpages of companies in your country, which would severely damage your country's export.

They could filter the search results to only display negative search results for things in your country or even add in some faked articles bubbling up into the Google top results about some contagious disease in your country to wreck tourism.

Other great articles to fake would be about some financial instabilities in your country. Traders have to react quickly when something like that crops up, and so they would probably already try to sell assets in your country before anything is even vaguely confirmed.

Chances are that even some TV shows, newspapers etc. will report about it and give it more credibility, as even journalists today also often just google things and then report whatever sounds somewhat plausible, especially when it sounds like a good story.

> Google could decide to suddenly stop displaying links to the webpages of companies in your country

This is the crux of your argument. Google already pulled out of China because of prohibitive regulation which makes my point exactly. The more regulation that's added to make search "safe" the greater the barrier to entry for new competitors is. This isn't even theoretical free-market mumbo jumbo, this is simply historically evident.

> They could filter the search results to only display negative search results

Sure. If I search for xbox, they could decide to only show me nintendo results. But the result sucks and I'll move to a different search engine. The market is wonderfully magical that way. Consumers don't need Microsoft's benevolent lobbyists to protect us from the dangers of Google.

So my point is, the motivation for these regulators action is not from the interest of the general public - but more like the well financed interests of market competitors who can't win by providing better results.

I have to agree with Sylos that this is a dumb argument.

I don't understand the shopping results argument listed on the top of the pages for search results. I have personally never confused them with actual results, and doesn DuckDuckGo Bing and Yahoo do this? If so, then why single out Google?

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