Google/IAC/Expedia (2019)
techemails.com
techemails.com
Google has an insane competitive advantage over most of the internet into knowing exactly what are people looking for and being the first to provide it.
This isn't any different to what Amazon does on their shop. They know what sells and for how better than any of their sellers, and they will know what basic product to launch and kill the competition.
But honestly, I think that if I was Google or Amazon...I would do the same? They aren't in the business of charity or powering internet users but making money for shareholders.
As a user I despise that, but as an entrepreneur monetizing information and channeling it to your own services is such a no brainer.
This is a very difficult topic to discuss, one that's born from people defaulting to Google Search and the lack of any realistic competition.
It doesn't matter how worse google search gets, it's still going to be the default search for ages due to it being default already on pretty much every device bar Windows computers when using Edge.
At some point this is an issue for legislators I fear, because I just don't see how anyone can fight this.
But I also don't like the idea of legislators having to sort it out, they may do more damage than good for all the parties, from companies to users to Google.
There is a lot of DEMAND for free services for sure, but doesn't seem a lot of people are putting their money where their mouth is? Kagi hasn't grown all that much, neither have services like Nebula?
I guess you could enforce some kind of open-tender requirements on their projects or something but that seems extremely difficult.
And why would it be in the interest of shareholders of the parts to only do business with the other old Google parts?
Cloud -- has to run at a loss in the immediate future to capture marketshare
Email -- nobody pays for email. Get ready for a much smaller mailbox and ads targeted by email contents. Get "sponsored" emails in your feed.
YouTube -- was a separate company before
Maps -- will become a free tourist map, may have to pay to unlock any zone except your home.
Search -- if it can sell ads independently, could be a viable business.
Advertising -- all the other units need advertising to survive. This could be a clearinghouse
In short, not clear that the pieces make sense as independent businesses with some exceptions.
The market for these loss-leading services is skewed because Google subsidizes their free offerings so that they improve their ads branch. Because it is hard to compete with a free (actually money-losing) service, it is very hard for competitors to spring up. And thus the whole thing is anti-competitive.
If they were separate companies and had to compete on their own merit, not subsidized by the ads division, they'd have to ask for money too. Then, competitors actually have a chance to offer something better. And through that, the reach of the ads business is limited unless they start to work with the competing services. This opens up the market for other ad markets, too.
And then we are a step closer to the free market that is efficient and good for consumers.
With Apple, Amazon and Microsoft doing the same in same markets... are we? Because it doesn't seem like "whap the random company that didn't pay enough for marketing" strategy isn't really working into establishing proper competition that benefits society.
Maybe... a different approach needs to be taken? How about starting to talk about legislation which would force large companies to allow competition into their vertical integrations - ALL of them, not just the single pet megacorp we hate this week. Level playing field and all that.
The argument "but if you spin off this major part of the company, it wouldn't be profitable enough to survive on its own" is the whole damn point. Using your monopoly in one area to prop up an otherwise-unprofitable arm controlling another area is exactly the kind of behavior antitrust law is designed to combat.
Too many people (especially around here) seem to forget that.
How would the market change in the wake of such a move? I can imagine that other companies will try to rebuild what Google was in other form. And these companies might not be US entities.
The Android company could simply get paid licensing fees for its OS and extras like Microsoft? Or maybe AOSP would instead continue as a intercompany project somewhat similar to Linux (the kernel).
> Cloud -- has to run at a loss in the immediate future to capture marketshare
That's dumping and I don't think it should be allowed so routinely anyway.
> Email -- nobody pays for email. Get ready for a much smaller mailbox and ads targeted by email contents. Get "sponsored" emails in your feed.
So, if people care they can pay for the paid service.
> YouTube -- was a separate company before
Was it profitable through? I see Alphabet published revenue numbers but I didn't find profit numbers. So maybe it would be hit by costcutting like limiting video length in some cases.
> Maps -- will become a free tourist map, may have to pay to unlock any zone except your home.
OpenStreetMaps exists, so an independent Google Maps company would have to compete with that.
> Search -- if it can sell ads independently, could be a viable business.
It's the starting and most profitable part that paid for all the rest, no? How it could not be viable.
> Advertising -- all the other units need advertising to survive. This could be a clearinghouse
But is the profit in the clearinghouse part or the selling ad space part? I'm guessing both.
It relies on your information taken from your phone/email/search/youtube history/etc. Without all that data the value of ads is much lower.
The break-up of AT&T provides another perhaps more viable arena for thought...
There the breakup resulted in multiple, independent competing companies cleaved from AT&T. Three organically produced combinations now remain of the original 7: 1. Verizon is what was the north eastern region (Bell Atlantic + NYNEX). 2. The now reunited trademark AT&T started as the western ones (Pacific Telesis and Ameritech) then added the southwest (Southwestern Bell/SBC) in 2005 and the southern states' one (BellSouth) in 2006. 3. The midwestern region was Qwest which is still around in some form as CenturyLink/Lumen.
From one massive company which did everything you got a bunch of companies that actually competed with each other in the main and market dominant sector. The market continued to evolve and real market forces forced combinations among them; IMO this is a good and natural thing.
Remember MCI and Sprint? Did you know they were already around pre-breakup as starving competitors of the monopoly? Suddenly they became national brands and introduced their own leaderships' priorities into the consumer marketplace (MCI in particular was early in seeing the importance of several early Internet packet-based technologies and in consumer email).
Prior to the breakup did you know that the domestic television networks (ABC, NBC, CBS, PBS, there wasn't Fox yet) had long-term contracts to send their signals over AT&T's terrestrial network? Almost immediately after the breakup (this is not a causal thing, but there is a lot of correlation) they all switched almost immediately thereafter to sattelite distribution (which had been available for nearly a decade).
-- The point I'm making is that you don't have to just draw inside the preexisting lines. The goal isn't the punish Alphabet, but to maximize competition in the market to the benefit of the nation (externalities positive and negative) and its consumers (first-order real good). Promoting competition may result in 2 search companies that can't reunite or something equally unthinkable...
But the pendulum will shift again.
(The core of my annoyance here isn't ranting over FAANGs, but the fact that any kind of suggestion of systemic fixes immediately brings out libertarians accusing us of trying to undermine poor economy.)
That and national security.
What is exactly the threat of YouTube becoming an independent company again, e.g.?
The only thing I see is a loss for Google in revenue and in YouTube in the "quality" of their ads.
None of this has any implication on national security.
But I don't think that's why intent profiling exists. What if, instead of helping you find quickly what you are looking for, they forced you through a less perfect system that, while leading you to your result, suggests you other, somewhat similar articles... Maybe you'll buy more? That incentivises ads and thus increases profits for the AdTech.
With generative text and image technology, the reliability of finding legitimately human and organic information is basically nil.
Intellectuals will begin forming smaller, more exclusive, and better-curated groups and content stores. We're already seeing a slow resurgence of micro communities, for example pubnixes/tildes, directories like ye olden DMOZ, blogrolls and protocol rings, e.g. Bongusta on Gopherspace.
None of them solve the search problem per se, but it's an answer to the eroding quality of web search results.
Youre always a person, and every single decision is always signed by a person. Yes, markets should be regulated and this should not be up to Google, and yes there are incentives within companies to make people behave in certain ways, but it's always been a strange line of argument to me that this absolves individuals.
If I worked at Youtube right now and someone told me to implement that stupid ad blocker I'd tell them to shove it. People who are fortunate enough to be in demand at Google or Amazon have a non-negligible amount of agency, and alternatives.
Of course. There isn't anything particularly evil in Google or Amazon. They are a result of the capitalistic environment. If not them, some other mega corp would have emerged to do essentially the same. Bigger companies get bigger. They are just optimization machines.
That's why we need governments to intervene, break up monopolies, stop mergers, etc. I don't care if it's "fair" for companies. Most people are worse off because of huge multinationals and monopolies.
As you said, it's only natural for a company to abuse a monopoly in one area to boost them in other areas, that's why these companies have to broken up to keep competition healthy in the other areas.
But we can blame regulators for letting them.
And, on the other hand, they're critical of Google which is operating precisely as such a company, and doing exactly what it needs for its profits to grow YOY.
Google is being lead by an MBA, has a very extensive management class, and employs a lot of people. The only way to be a lead and earn good money is to have people under you. The structure of Google is very analogous to other companies in the same sector.
Frequently there's no other behavior that would make sense for Google to exhibit. The job of all the execs in the company is revenue growth.
Could you enlighten me here? Maybe I can update my model with your feedback? Do you believe that you can somehow have your cake (infinite growth) and eat it too (ethical companies which care about the community when the profit margins get slim)?
Your ETFs rely on the companies in the basket doing what Google does.
Unfortunately that's a fundamentally anti-capitalist way to go about things because the end result is what Google, and frankly all other dominant, publicly traded corporations are doing right now: profit by increasing rent-seeking and strangling competition rather than out-innovate (e.g 1, for perspective Google's cost of remaining the default search engine is about on par for their average R&D spend; in a healthy, thriving, innovative environment that wouldn't be the case).
The problem isn't Google per se, they're acting as expected. It's the regulatory capture of the judiciary and FTC from ignoring and/or dismantling the laws that would have prevented this environment from occurring in the first place. So we don't have a vibrant, diverse ecosystem anywhere, whether search, washing machines, publishing, defense contractors, etc.
Luckily the tide is turning with the Google trial on right now, and Amazon kicking off soon.
(1) https://www.theverge.com/2023/10/27/23934961/google-antitrus...
Without them, power eventually gets concentrated into few companies holding monopolies, while the fundamental of capitalism is competition.
The problem is anti-trust laws have not been enforced and we let tech companies hold way too much power.
I know it's not something that's going to happen any time in the foreseeable future, but I think it would be fantastic for our society and economy if the top marginal tax rate was 100%, with that tax bracket starting at (just as an off-the cuff estimate) something like $50 million/year, with regular and capital gains income counted together and taxed at the same rate.
Many people witter about how that means there's "no incentive to do better", but a) if you as a person making $50,000, $500,000, or even $5,000,000 per year think that this applies to you or is ever likely to, you are probably wrong, because even the person making $5M/yr is closer to the one making $50K/yr than they are to the one making $50M/yr, and b) if the only incentive you personally respond to is monetary, you are in the minority, because it's plain from empirical evidence and plenty of solid scientific research that the norm for human beings is to care about doing a good job for its own sake—so long as they're not being burned out, beaten down, and kept poor, and especially if they're allowed to do work that they like doing and are given some degree of ownership in it (not legally/financially, but conceptually—autonomy, a say in the process, etc).
More realistically, I'd love to return to something like the tax structure in what many look back on as a golden age: the post-WWII years, when the top marginal tax rate was above 90%, and yet somehow our industry chugged along at a fantastic pace, and people didn't just stop caring because there was "nothing to work for".
If I search for "NYC to LAX Monday", I don't care if I have to click through to a shady website with lots of SEO experts who will probably miss the "Monday" part of my query anyway, I'd rather get a nice list of flights right in my search results. I don't care if those are provided by Google, a third-party website that Google scrapes, somebody Google signs a deal with or somebody who implements a Google-provided API for this and is good at SEO, as a consumer, I care about flying, not clicking links. Forcing Google to hide the flights UI and link me to Expedia is a worse experience for me. Same applies to News, Shopping, facts, answers etc.
If the Google results ever get really bad or way too expensive, most people will switch search engines (or switch search engines for a single use-case), like searching for products on Amazon instead of Google or searching for flights directly on Expedia. So far, Google results are getting worse but results from other (free) search engines aren't that much better, so other people stay with Google and there is that.
Mr Diller here I am sure is far from angelic but he is doing heroic if futile work. Google simply cannot stop their antics unless forced to do so.
To the web itself.
I can imagine a Google exec reading this and laughing. Because no matter what we do you keep paying whatever number we type up
"it's good for the country"? How much do you need to have taken off until you say (and believe) such things?
TV networks didn’t, even in their prime. I wonder if that’s because there was more than one of them and they had to … with each other.