Monday, December 28, 2009

Google Dominance: Boon or Bane?

I tend to be suspicious of big monopolies. While it may be convenient to shop under one roof, there is always a price to pay. Adam Raff, a New York Times contributor writes about the dangers of allowing any one company to dominate our search results. Along the similar arguments of the famous John Dalberg-Acton phrase that 'absolute power corrupts,' let me add that dominance corrupts and absolute dominance corrupts absolutely.
Raff points out the following:
  • Google dominates 71% of both search AND advertising;
  • Google has actually penalized certain websites from legitimate searches;
  • Money talks;
  • The perception that Google is innovative is not exactly true as many of the latest Google apps are not developed in-house, but purchased from outside. 
Some will argue that Google is itself so innovative that we needn’t worry. But the company isn’t as innovative as it is regularly given credit for. Google Maps, Google Earth, Google Groups, Google Docs, Google Analytics, Android and many other Google products are all based on technology that Google has acquired rather than invented.

Even AdWords and AdSense, the phenomenally efficient economic engines behind Google’s meteoric success, are essentially borrowed inventions: Google acquired AdSense by purchasing Applied Semantics in 2003; and AdWords, though developed by Google, is used under license from its inventors, Overture.
Let me make a few comments.
1) Dominance Corrupts: It is the last point that is particularly disturbing. While it is true that Google has dished out lots of freebies, the thought that the richer companies can receive priority listing is by itself alarming. If power and dominance corrupts the Monopolizing corporation, it also attracts many others to dance the same dance, to sing the same song. In other words, if dominance corrupts the primary player, it draws in many secondary groups toward a greater disparity between the have's and the have-not's.

2) Dominance: Privilege or Right? A dominant search provider like Google may claim that it has the right to put its own products as priority. However, when one's search engine has penetrated mainstream society, Google has to relinquish this 'right.' For instance, consider Microsoft Internet Explorer in the year 1998. In trying to corner the browser market, Microsoft was sued for embedded Internet Explorer within its ubiquitous Windows operating system, effectively shutting out the competition.Where do we draw the line between privilege and right? Do we need a lawsuit to settle the distinction? I hope Google will play fair. Otherwise, they will, like Microsoft be hit with an anti-competitive suit.

3) Some qualifications: The writer, Adam Raff is a co-founder of Foundem, a firm supposedly victimized by Google. It is one thing to be writing as a third-party observer. Raff is not a third party. In fact, according to the article itself, Raff seems to have an axe to grind with Google.

4) Competition: In order for any industry to remain innovative, low cost and vibrant, competition is key. Thus, we must be suspicious of any organization that seeks to upend the competition with utter dominance. Personally, I like to use Google because of its search accuracy. Yet, I use them with caution as well, knowing that too much dependence on one company is definitely putting all my eggs in one basket. Thus, I switch search engines periodically, using Microsoft Bing, Yahoo Search or Ask engines.

Finally, I believe Google will need to look at spinning off its cash cow at some point. Let the public choose between a for-profit search, say Google-Pro (like for selling and buying products) and a neutral search, say Google-Standard (like students doing research). I am aware that there are some cases where the line between profit and not-for-profit is blurred. For such cases, let them appear in both search engines.

Let me also add that I do not have a problem with Google trying to make money openly. However, to covertly prioritize websites and discriminate against smaller players is definitely anti-competitive, even unethical.


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