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Comment by belorn | Hacker News Reader

In one of the other threads, some stated that Google do not have monopoly status. The claim they used was that google only has 25% of the search market.

This topic is interesting because it shows how much in a monopoly status google really is in in controlling where traffic goes on the net.

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Interesting point!

Google's search team has been famously resistant to any influence by Google's sales/marketing teams on ranking decisions. Search quality gave rise to the 'golden goose', after all, and the self-conception of the team, and its individual members, is based on independence from purely money-grubbing considerations.

But I wonder, what happens when Google's antitrust lawyers came to the ranking team, and say: "soften this penalty [or otherwise tweak these quality-rankings], because otherwise we'll be in more trouble with regulators or leave too much evidence of market-power."

Could the search team still say, "buzz off, we're sticking to what we know from the numbers is what's best for our users"? Or does keeping regulators happy, and avoiding smoking-gun fact-patterns, trump everything? I suspect it often will, because of the unique risks of state enforcement and appearing unlawful. It's also easier to rationalize "we're sacrificing our own idea of what's best because the law seems to require it" (even if the actual risk is fuzzy before losing in a formal legal process) than "we're doing this to make the guys over in ads/mobile/etc a bit more money this quarter".

you are not using that word correctly. If Google was the only company doing search and prevented others from entering the market you would be correct. Being the best through a superior product and innovating is not a monopoly.

Doesn't matter how you achieve a monopoly: it's defined by dominance, not bad-behavior. And once you have monopoly power, things that used to be legal for you to do – for example certain pricing or bundling strategies – can become illegal.

the entire argument is questionable as to what Google's strategy is but they are only in that position because of a superior product in a market with a relatively low barrier.

Low barrier?! Giant companies like Yahoo, staffed with large teams of search technology pioneers, have been scared out of search competition. Google touts its massive custom infrastructure. The arms race between Google and SEO creates a massive pollution backwash of false quality signals on the web, that make things way harder for any upstart which lacks Google's decade-plus of proprietary know-how and billions in hardware.

And that's before considering the contractual defaults across software (Firefox/toolbars/bundleware) and subsidized hardware (Android), that few people change. (Many don't even know it can be changed, or don't even know the difference between "Google" and "the Internet"!)

Those are all big barriers to entry, even if they've been earned by excellent technology and business strategy.

while DDG started by 1 guy and entrants like blekko or qwiki can differentiate in other ways and enter and compete easily.

Again everything you are saying is because of superior product/employees and innovation. Your entire argument is based off no one else can come up with a better product so lets punish them

Where'd I say "let's punish them"? I'm just accurately labeling the situation.

Google's dominant position constitutes a 'monopoly' and 'monopoly market power', in a common understanding of those words, and in the senses often used by economists and regulators. Their search market has very high 'barriers to entry', in terms of costs-to-compete, ability-to-reach-customers, returns-to-scale, and network-effects. (Separate from all the specific things I mentioned which make it extremely hard for entrants to get a foothold, you can also just look at the profits. Whenever there are big profits, there are business 'moats', or else someone else would grab a bunch of those profits themselves.)

This makes them a likely target of government antitrust action – an observation which is true whether or not such antitrust laws, and related enforcement actions, are a good idea or not. Again, I'm interested in accurately describing what exists, not making moral or policy judgements.

Qwiki? Really? They never offered ranked search, abandoned their 'visual explainer' product long ago, and are now part of Yahoo with their multimedia storytelling app.

DDG, Blekko, and all search sites other than Google/Bing/Yahoo/Aol/Ask are together less than 0.3%-1% of the US market. And yet this market is wildly profitable for Google – and almost no one else. (Bing, the distant 2nd-place, has lost hundreds of millions every quarter since 2007.) That's not an indication of vibrant easy-entry competition: one company dominates market-share and profits, and the number of competitors and new entrants have been declining over time.

By the way, the founder of your 'compete easily' example Blekko also disagrees with your assessment, and has since the outset of Blekko. In this 2007 post he describes how it's impossible to compete for market share head-on with Google due to its "immense and amazing power" in a "winner-take-all market":

http://www.skrenta.com/2007/01/winnertakeall_google_and_the_...

>DDG, Blekko, and all search sites other than Google/Bing/Yahoo/Aol/Ask are together less than 0.3%-1% of the US market. And yet this market is wildly profitable for Google – and almost no one else.

I think this sums it up perfectly. Theres plenty of competition just no one can compete because google offers a superior product. As soon as google offers an inferior product or a competitor offers a better product people will abandon ship. They do nothing anti-competitive nor blocking entrants into the market.

> Doesn't matter how you achieve a monopoly: it's defined by dominance, not bad-behavior.

Well when you describe it like that, makes me think antitrust laws are just silly. Isn't the job of a company to be the best and beat their competition?

From the perspective of web users, there is choice(even if heavily skewed by default search in browsers). But from the perspective of web sites/web companies/web devs/web advertisers, there is very less choice and bordering a monopoly, as this example illustrates. Even worse if you're someone like MapQuest, a shopping site, or Yahoo Finance, since most people tend to search locations on search engines/browser and are quickly steered to their equivalent competitors from the search engine company. Anyway, usually antitrust regulations are about market power and influence, for example see DoJ vs. Apple over eBooks, even though iOS never even had majority share, forget about a monopoly.

The U.S. accused Apple Inc. and five of the nation's largest publishers Wednesday of conspiring to raise e-book prices. I don't even see how thats relevant to how Google does business within their own ad products. Who exactly is Google colluding with to suppress or hurt competition ?

Companies will do business where the users are. The minute there is a better product or users abandon google, those same people you listed will leave as well. So maybe we should go after Facebook for destroying MySpace as well ? The entire argument is based on the fact that Google offers a superior product and should punish them for this.

> This topic is interesting because it shows how much in a monopoly status google really is in in controlling where traffic goes on the net.

Does it? I mean, is there any reason to believe that Rap Genius is typical in their degree of dependence on Google here?

I'd replace the word monopoly with popular.

"A monopoly (from Greek monos μόνος (alone or single) + polein πωλεῖν (to sell)) exists when a specific person or enterprise is the only supplier of a particular commodity. Monopolies are thus characterized by a lack of economic competition to produce the good or service and a lack of viable substitute goods. The verb "monopolize" refers to the process by which a company gains the ability to raise prices or exclude competitors." - Wikipedia

You can monopolize an market by popularity, and thus create a monopoly. However, monopoly and popularity is not the same word.

Google is not the only supplier to internet searches and is not excluding competitors. They are merely very popular and are thus not a monopoly.

You are interpreting "monopoly" literally. In the context of antitrust law, you only need to have a big enough market share to appear on regulators' radars. The actual market share threshold varies from country to country, but typically it's around 60%. Google certainly meets that criteria in many countries, not only for search but for online video as well.

As for "excluding competitors", Google is having a tough time with antitrust regulators in the EU for exactly that. For a more obvious example, see their shenanigans with YouTube and Windows Phone.

I totally don't buy that Google has a monopoly on search. Anyone here could start a search engine tomorrow. Sure, it might suck, but there is no barrier to entry. It isn't like Ma Bell telephone companies who had blocked other competitors from running copper wires to homes via tons of local ordinances... which reminds me, its pretty hard to have a true monopoly without some help from the government.

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