Robert Bork on antitrust: Google is no Microsoft | Hacker News Reader

Robert Bork on antitrust: Google is no Microsoft

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57 pointsmtgx55 comments

I have a hard time understanding how this can be considered an antitrust violation when switching is so easy and there is so much competition in the space. While a company should be held accountable for harming consumers, it should be held accountable for stupid consumers.

I really don't like how Google is including all the links to their own properties inside of their searches. In fact, I like it so little that I pipe most of my searches through DDG now. Yet I still wind up at Google around 20% of the time when I'm searching for terms with many matches. Google gets the ordering better.

It is scary to think what might happen if Google is found to be violating antitrust laws.

Indeed, there are dozens of choices for web browsers, and even if you limit yourself to "mainstream" browsers there are still close to half-a-dozen. Likewise search, and there's nothing other than quality of results limiting any of them (i.e. using Chrome as a browser doesn't prevent you from using DDG or Bing for search, or even make it difficult).

>I have a hard time understanding how this can be considered an antitrust violation when switching is so easy.

Switching was never hard even in Microsoft's anti-trust case. You could easily download and install Netscape. Microsoft never forbid anyone from doing it and I can remember distinctly Netscape being included with my ISP's software floppy. What made the case was all about what was available default to the user. Interestingly under the same context you will find anti-trust violations if Chromebook became the majority and Firefox din't come installed by default.

It doesn't matter how hard switching is for the browser, what matters is how hard switching was for the OS - that's where Microsoft had a monopoly. In that, switching was very hard. They were trying to leverage that monopoly in a new market (browsers).

The key point. SW online does not have the charachteristics of natural monopoly. I have 8x choices in my integrated search bar (the default ones on Firefox). There are some network effects, or returns to scale from usage analytics that impact quality, but that is a different animal. MS Dos / Intel x86 technical architecture was actually exclusive.

Also, with MSFT was clearly a case of prediatory pricing funded by cross-subsidy from the monoply business. They set out to 'kill' netscape in its infacy as a business stratgy. Google is arguably just doing its job, and doing it better. Advertisers fell like there is "no choice" (because of scale), but they are sock-puppets. The consumer is the searcher. Advertisers have plenty of other places to advertsise online, so there is no monopoly.

"Yet I still wind up at Google around 20% of the time when I'm searching for terms with many matches"

I'm the same, and, unfortunately, even more often when searching for terms with very few matches. Google actually finds the relevant things.

The Clinton administrations anti-trust judgment against Microsoft burst the internet bubble and sent our economy into a recession, the effects of which we are still feeling.

It also shackled Microsoft for 10 years as part of the judgment, so they have been unable to effectively compete with Google and Apple. This year, that 10 year judgment agreement ended, so expect to see more from Micrsoft.

I've never heard this argument before.

Why was Microsoft owning the desktop and browser market so fundamental to the US economy?

They weren't. Computers and Internet became a commodity so the market was overcrowded and overhyped. Once the realization happened, the market plummeted and tons of investment and effort went down the drain.

People went batshit insane over the internet in a few years, invested tons and tons and it all collapsed.

The PC and internet fuled the productivity gains of the nineties. If you look at the timing, the stock market crashed a couple of months after the ruling came out. Up until that time, the internet was the wild west. With the Microsoft judgment, it became clear to the market that the internet would be subject to regular rules. The stock market plays off such psychological factors. Also, Microsoft was the biggest player back then so it was a blow to the entire industry. People were wondering if the interet boom was a speculative bubble, and the ruling was the pin that popped it.

Certainly not, Google learned from Microsoft that without friends in Washington to make these problems go away, they'll charge you with random offenses until you start contributing to their campaigns.

"That's a nice business over there, would be a shame if we found you were running a monopoly, why don't you contribute to our campaign and we'll protect you from those DOJ lawyers"

If giving a browser away is anti-competitive I wonder what giving an entire operating system + browser away for free is.

People seem to forget that Microsoft was targeted because of its anticompetitive tactics as a monopoly. At its peak, MS had something like 95% of the market for PC operating systems, and was busily using that monopoly to push its way into other markets where it wouldn't necessarily be competitive on its own. The problem wasn't giving away IE, the problem was giving away IE with their OS so that they could take over the browser market by leveraging their OS monopoly.

Until and unless Google (or any other modern player) has a 90+% market share in some area, comparisons with MS's antitrust case are faulty.

And I never saw it this way... IE was legitimately better than Netscape for a while, and consumers gravitated to it. As proof, IE is still the default browser, and Windows is still the dominant PC OS, but IE has fallen from its top position because competing browsers are better. Microsoft's so-called "monopoly" on the desktop did not prevent competition; you could always easily install a different browser, and now that the alternatives are better than IE, people are doing that.

So, when Microsoft execs were talking about choking Netscape and 'cutting off their air supply', they meant by making a better browser, you're saying?

Yea, remember that it also affected Opera too.

The air supply was a reference to revenue stream, iirc. Early on Netscape charged for their browser, and also charged for other products around it (NS Server, etc). I think even by the time they got to giving away the browser for free, it was seen as a bit of a 'gateway' product to other paid NS products. Those were threats to MS as well (or were perceived to potentially be).

> IE was legitimately better than Netscape for a while

That's right. IE was free. Netscape was not. I think this is a point a lot of people miss.

I... actually didn't know that Netscape was a bought product until just now.

It was free too pretty soon after IE reached OK though if I remember rightly.

Netscape did crash far too often though in that time period and was probably better even beyond all the made for IE websites.

>>IE was legitimately better than Netscape for a while, and consumers gravitated to it. As proof, IE is still the default browser

Consumers did not gravitate to IE because it was "legitimately better" than Netscape. It never was. They did so because it came installed by default on their computer and most of them were too lazy/ignorant to find alternatives. Heck, most people didn't even know what a browser was. They just knew that double-clicking that blue e icon allowed them to get on the Internet.

IE is still around today because of the large number of legacy inhouse applications and websites that were developed for it back in the day. There isn't a single thing it does better than Chrome, Firefox or even Opera.

  > Consumers did not gravitate to IE because it was
  > "legitimately better" than Netscape. It never was.

You don't know what are you talking about. IE4 was already better than NN4 with its "layers" and half-assed JS-based CSS implementation. IE6 was far far ahead of Netscape. It was the best browser at the time. The problem is that IE stagnated from that point.

> The problem is that IE stagnated from that point.

Recently, they've caught up pretty well.

That they had to catch up is the real problem. They willfully stagnated for years.

I was a die-hard Netscape loyalist and Microsoft hater until 2000. I finally gave up NS4.7 for IE5.5 then, because Netscape wouldn't work on a large number of pages on the web. It would hang on their Javascript, or misrender page layouts.

I'm still a Microsoft hater, but IE did win because it was better. Netscape totally dropped the ball on that.

IE4 and IE5 were:

* Faster than Navigator.

* Had more features than Navigator, DHTML being the most important.

* Were highly compatible with content written for Navigator.

Navigator ran on more platforms. So yeah, if you were not running on Windows, Navigator was superior.

Consumers did not gravitate to IE because it was "legitimately better" than Netscape. It never was.

It damned sure was. The browser game was Netscape's game to throw away. And sure enough, they did just that with 4.

None of the browsers shipping today have anything to do with the browsers that were shipping in the NS4/IE4 era.

And more importantly cancelling Mariner which was going to be Netscape 5.

I can vouch for IE being far better than Netscape.

Regardless of the merits of IE, or lack thereof, the point is that it doesn't matter if you get up to anticompetitive behavior similar to what MS was accused of unless you actually have a monopoly on something.

Microsoft may have had a dominant share in the PC operating systems market, but I don't think they were ever a monopoly. Anyone who wanted an alternative to Windows was always free to buy a Mac. It's not Microsoft's fault that more people didn't do this; it was because Macs were much more expensive than commodity PCs and most buyers didn't think that the extra cost was worth it. If Apple had ever made their operating system run on commodity PCs, they could have taken a large chunk of the OS market from Microsoft. But that wasn't Apple's strategy.

As far as bundling Internet Explorer is concerned, one can argue that Microsoft foresaw that a browser was going to become a required piece of software that everyone would want to have on their PC (just like a text editor; nobody every complained that Microsoft was giving away Notepad and Wordpad with Windows). And without a pre-installed browser, you'd have to go to an FTP server just to get a copy of a different browser, something that the average user would be unable to do. Similarly, Apple bundles Safari with every Mac, iPad and iPhone for the same reason: you couldn't sell one of these devices today if they didn't have a browser on them as soon as they came out of the box.

Microsoft did engage in real anti-competitive tactics, such as coercing hardware manufacturers to pre-install Windows on all their machines whether users wanted it or not. However, there are laws against "restraint of trade" [1] that apply whether a company is a monopoly or not.

[1] https://en.wikipedia.org/wiki/Competition_law#United_States_...

>Microsoft may have had a dominant share in the PC operating systems market, but I don't think they were ever a monopoly.

Thats the definition of a monopoly. At least in my language. (Dutch).. Dominant market share. Not all monopolies are bad, but any market with high margins and a single vendor with 90+% maketshare is a monopolistic market. Thats just how words and definitions work. Thats not an opinion.

Now here comes the opinion part: consumers had little to no choice. Why? Because the core functionality, is compatibility. Who would buy a car that you cant drive on the common road? I make the road analogy, because the difficult aspect of the OS market is that its infrastructure.

Imagine a world where cars, gas stations, oil supply and roads were completely unregulated except for the upholding of IP laws (in particular: patents) that enable certain types of incompatibilities to get legal protection. You are driving in a MS car, with special patent-protected tires, that only work on MS roads. They are also the only type of car allowed to drive on those roads. They have a special patent protected triangle shaped gas supply, that only MS fuel stations can resupply. Now, on this road you will only find exits to MS shopping malls, not those of competitors.

This could go on and on. Im not in the MS is evil boat, but market regulations in the IT are about 1% of what we actually need. And compared to traffic, snailmail, phone systems, electricity its extremely unregulated.

And maybe, if they are all truly forced to compete on quality, we would no longer have this "everything is broken and nobody seems to mind" problem. Because nobody minds, because it is not about getting customers: it is about how to hijack them. How to lock them in. And this is even more true for a connected world ... I cant just move a social life to another social network. I do not have the freedom to do that.

If we can not pick indiviually, we should be picking democratically. Or at the very least, regulate it all until there are enforced common fileformats, including application-containers, open communication exchanges and full data liberation. The only other alternative is complete exploitation by a monopolistic bully.

A monopoly means that there is no competition. For example Wikipedia defines it this way:

"A monopoly exists when a specific person or enterprise is the only supplier of a particular commodity." [1]

A good example would be an electricity provider that owns the only power transmission lines in a given area. (This would usually be a legal, government-regulated monopoly.)

In contrast, it was definitely possible to use Macs as an alternative to PCs, even in large business environments. At some point, I even worked on developing an enterprise software product that ran on Macs.

"If we can not pick individually, we should be picking democratically. Or at the very least, regulate it all until there are enforced common fileformats, including application-containers, open communication exchanges and full data liberation."

There's a lot of software available that allows Windows machines to exchange data with all sorts of other machines. Most Microsoft products that I've ever seen allow you to export or import your data in open formats (e.g., Excel allows you to export data as CSV format). Not to mention that many third-party products can read and write Microsoft file formats. So I don't see how Microsoft is locking up people's data. All this interoperability was created by the free market (e.g., Microsoft's influential customers demanded it), not by government regulation.

Think about what kind of a mess bureaucrats and courts with no technical knowledge have already made of our patent system. Do you really want government regulators and courts to also dictate what our standard file formats should be? I'd much rather take my chances with the free market.

[1] https://en.wikipedia.org/wiki/Monopoly_(economics)

>A good example would be an electricity provider that owns the only power transmission lines in a given area

The only legal implementation of the win32 api. The only legal implementation of FAT. The only legal implementation of doc'95. The only legal implementation of directx. Example after example, not of innovation (comparable solutions exist) but of intentionl incompatibility. The intent was demonstrated, not just in encrypted file formats but actual email correspondence where the intent was made explicit.

Yes. Legal action, pressure and illegal (from a ToS perspective) reverse-engineering allowed some people to overcome parts of their prison. This was not the result of the free market, but a political and social campaign. And although it liberated some, these people paid a hefty price of digital exclusion, and this war took almost a decade, which many players only survived because they chose to pay Microsoft "protection" money. From Novell, to TomTom.

Your coloring of events, is far removed from reality. Just ask any linux desktop user foot soldier in the 90ties. There were times they were updating MSN protocols as often as possible, just to make sure people using linux would be socially isolated, with their "illegal" clients..

The biggest shame, is that with all this focus on the oppression in the last decade, we fail to discuss, the even bigger risks in our new cloud based world, and the consolification of computing devices. Things are going to get even worse, without regulation... Microsoft was a kind dictator compared to how Apple or Amazon tend to operate.

And just because politicians may be corrupt, that does not mean, that there is a solution to all of this that does not require the right types of regulations. Like data liberation. If we need to fix politics before we can fix this we better get started.

What's Apples share of the tablet market?

Oddly MS argument was that the browser is a core part of the OS that should ship with the OS. I think history has shown this to be true. Browsers are now more commonly bundled in OSes then grammar checkers in word processors.

Google controls 90%+ of the search market in almost every European country. In the US, it varies based on how you measure it but is around 80%. Also, the definition of a monopoly is not a strict % test but considers many other factors.

Being anti-competitive is only illegal if you have an actual monopoly. Microsoft certainly did. I don't really see any area in which Google has one. So, your last statement is not meaningful.

AdWords and search market share? what is the distance to being a monopoly?

Under some laws 'significant market power' might be a level that triggers scrutiny of competitive behaviour. Google would reach that level for search, advertising and Android at the very least in my view.

If you consider the market for mobile phone/tablet OSes available to OEMs the market is really Android and Windows Mobile and Androids market share may lead it to be regarded as a monopoly. I think that they need to be (and probably are) VERY careful in their behaviour in relation to all the phone manufacturers.

Please note I am making no accusation of anti-competitive behaviour by Google but I do believe that they will fall under competition law in several markets so they are not generally immune from such accusations.

You're missing the forest for the trees. There's much healthier competition in the OS market today, and it's easy for consumers to find alternatives to the market leader.

Making random accusations of corruption is neither helpful nor does it appear to have much basis in truth.

1) Google does make political donations, but they are quite small (~$5000 per candidate) and primarily towards candidates who - to generalize greatly - are "pro internet" (eg anti-SOPA etc)[1][2][3]. One could argue that these people also generally have a "hands off the internet" approach to internet policy which is favourable to Google. One could also argue that a a "hands off the internet" approach to internet policy is sensible..

2) Based on your comment If giving a browser away is anti-competitive I wonder what giving an entire operating system + browser away for free is it would appear you don't understand what anti-competitive behaviour is or what happened in the MS case. A company can give away anything they like - it only causes legal problems if they have market dominance in that market and they use that dominance to exclude other competitors. Microsoft didn't get in trouble just for making IE free - they got in trouble for stopping PC manufactures installing Netscape on new PCs if they installed Windows and for manipulating the Windows APIs to favour IE over Netscape.[4]

[1] http://thehill.com/blogs/hillicon-valley/technology/244593-g...

[2] http://www.google.com/publicpolicy/transparency.html

[3] http://static.googleusercontent.com/external_content/untrust...

[4] http://en.wikipedia.org/wiki/United_States_v._Microsoft

It could easily be argued that google is using their search monopoly to exclude less capitalized competitors from developing mobile operating systems by selling below cost, which harms consumers by reducing competition and choice.

Using open secrets data does not even begin to cover the ways in which a company can influence politics.

That sounds almost sensible until one realizes then when you say using their search monopoly what you mean is using the money they make from search.

By that logic NO profitable business would ever be able to move into another line of business. Also, that isn't what anti-trust law is about.

Whether they have a monopoly or not is a question for the courts, I consider them to have a monopoly in search, apparently you do not. In the case that they don't have a monopoly in search then you're correct, but if they are found to have a monopoly then they could be found in violation.

Actually anti-trust law is about using the profits from one business to vertically integrate others by using the profits from one to subsidize the other. There is a modern component to it that revolves around consumer harm but anti-trust law was written as a means of redress for other businesses.

http://en.wikipedia.org/wiki/Standard_Oil#Monopoly_charges_a...

> Google had "commissioned" the study but the views expressed it it were solely his and Bork's

I agree with the notion that Google is fundamentally different to Microsoft, but I don't understand why reputable people, presumably without any financial need to do so, take money that would give them an appearance of bias on an issue. I'm not saying either Google or Bork did anything wrong here per se. But I know if I had a reputation to protect, I wouldn't do it, because it would color how people perceived me in the future. I would get both sides to fund it or none of them.

Maybe Apple is the new Microsoft, not Google? Maybe Apple does not have as many potential competitors i.e. virtually anyone selling ad space, to raise complaints?

Reason why Google is no Microsoft monopoly: no copyright enforcement.

Microsoft depended on the government's ability to help enforce copyright protection, thus the government sponsored its monopoly. If Google went off suing all its users then I bet the government would care more.

He said that Google had "commissioned" the study but the views expressed it it were solely his and Bork's. (Because of health reasons, Bork didn't attend today's AEI event.)

-- In case anyone was wondering. Not that there's anything wrong with that. Still Interesting.

Research is always funded by someone. Nothing is truly unbiased or without hidden agendas.

"Given the serious factual, logical, and economic flaws in the antitrust complaints about Google's practices, one can reasonably conclude only that Google's competitors are seeking to use antitrust law to protect their own market positions."

Translation: the technology industry learns fast. If you want to be a big player, be prepared to play hardball.

Personally, my favorite from the 90s is the MS OS/2 2.0 fiasco I discussed before.

I'm no lawyer but logically speaking the antitrust allegations against Google don't seem like they'll amount to much, firstly the notion of having the government dictate what goes in your app/website doesn't sound right nor legal. And there is the blatantly self serving demands from competitor alleging consumer harm; they either want to be guaranteed prominent placement among Google’s results or they want Google to only feature links, and only links to the end of time, meaning they don't want them to innovate and would like them to offer an inferior product, and given that people have had a taste of Siri for example, the notion that search engines must only serve links has dissipated.

There is also the small detail of Google being free, and has virtually no-lockin and anything they offer has an equivalent offered by somebody else. And last time I checked they didn't lack in competitors, so why is the government essentially also competing against Google. The whole thing seems like a result of a major political malfunction.

Sorry but you don't seem to understand how antitrust law works. Today, in the US and many other parts of the world, Google has a monopoly in the search market. Google is using their monopoly in that market to influence a second market (any one of a number of content verticals). It doesn't matter whether the service is free, or not free. Influence and unfair competition - this is the definition of antitrust. (How can any SEO or SEM expert ever compete against Google itself for search rankings or ad placements? They can't.) Microsoft tried to use its monopoly in OS to influence browser choice, and was rightly persecuted for it; this case is not much different.

In the US at least, you must prove that the consumer was harmed in order to have a successful antitrust complaint, and that's going to be pretty hard with google. With microsoft, it was a pretty clear pattern, ie rebates to OEMs to thwart competition. And more recently, disallowing users to change their default browser. Instead, with google, you can bid/get ranked high and you're still able to compete. You can install chrome and change the default search engine easily, etc etc. Google has been pretty careful about avoiding mistakes Microsoft made. And at the end of the day, if you don't like google, you type in "bing.com" and lo and behold, you're using another search engine. You could not (at the time at least)just install a competing OS within seconds.

"Antitrust harm" is not limited to consumers, you can prove harm to competitor businesses as well to qualify a lawsuit.

Except that is not how antitrust works in the US. Competitors may be harmed if it is for the benefit of consumers. And it may not always be evident that the consumer benefits right away.

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