back to article Google versus the EU: Sigh. You can't exploit a contestable monopoly

So, the EU Commission is going to call Google in and give it a really hard talking to for offering what Google's users rather like to have. And if they decide that, well, Google has been giving the consumers what the consumers desire, good and hard, then they're going to fine the Chocolate Factory up to 10 per cent of global …

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  1. Anonymous Coward
    WTF?

    So....

    ..you were happy with IE bundled on Windows then?

    1. JetSetJim
      Thumb Down

      Re: So....

      Apple, meet orange. MS abused the market by forcing acceptance of Windows as the desktop OS from pretty much every major manufacturer. Bundling IE (especially in a way that makes it difficult to get rid of) in then gives it a good way to control internet standards, which then gives them a patent licensing revenue stream.

      It's easy for someone non-techy to use another search engine, less easy for them to swap out IE (or even Windows for that matter).

      1. Tomato42
        FAIL

        Re: So....

        Your average punter has no idea what a browser is, let alone that Google isn't "The Internet".

        And I don't care about google shopping, it has always been utter garbage so I've been using different sites. The problem is that they abuse their monopoly in any way they can: YouTube users turned into G+ users, 60fps YouTube - Chrome only, 360° YouTube - Chrome only, gmail IMAP - non standard compliant, gmail POP3 non existent, offline gmail - you guessed it Chrome only. That's just few examples.

        Shopping is just the tip of the iceberg.

        1. Anonymous Coward
          Anonymous Coward

          Re: So....

          Huh? I've been using POP3 for GMail for years now. They even have a guide up to help you with all the settings you need. Here's a link for you:

          http://lmgtfy.com/?q=gmail+pop3&l=1

        2. Dazed and Confused

          Re: So....

          > Your average punter has no idea what a browser is, let alone that Google isn't "The Internet".

          True, but when the average punter goes and buys a PC then it comes with IE installed and nothing else and IE is pre-programmed to use Bing. So you could argue that Bing has a monopoly position. But somehow the average punter manages to change things so that they choose to use Google.

          MS have spent gigabucks in advertise Bing, but the average punter is still refusing to use it.

          Google don't have a monopoly, Google have a product that people are choosing to use.

          1. The Dude

            Re: So....

            I use Bing to find images because I find it works better than Google, but I use Bing to search through DuckDuckgo, which is a bit odd. It works for me. I believe I started using duckduckgo on the recommendation of an article here on The Register, which (as we all know) has a monopoly on techy eyeballs.

        3. Anonymous Coward
          Anonymous Coward

          Contested monopoly, sir.

          None of these dominant positions are uncontestable; there are alternatives to all.

          If Youtube is crap, use Bing to search for cat videos on other video-sharing sites. Don't login to Youtube or or Google or even create an account there.

          If Gmail is crap, use your ISP's Webmail interface or one of the thousands of other email providers on the Internet. Or even set up your own mail server, as some US politician or other did.

        4. h3

          Re: So....

          When it was called froogle - Google Products was pretty damn good.

          (No idea about something similar that isn't as Google's now though. So I just use Amazon and a few other sites - go direct)

      2. Oddlegs

        Re: So....

        But Microsoft didn't get in trouble for forcing Windows to be the de facto desktop OS. They got in trouble for using their (fairly won) OS monopoly to try to create a second monopoly.

        The situation with Google is pretty much identical. Their search monopoly is legitimate and no-one is saying otherwise. The issue comes from using that search monopoly to push other products. You can argue that it's trivial for users to go to other price comparison sites but the truth is no-one bothers because there's a big shopping button right at the top of any Google search.

        Should Google be punished because users are a bit lazy? Possibly not but it's exactly the same rationale behing Microsoft's fines over the browser wars.

        1. fandom

          Re: So....

          "But Microsoft didn't get in trouble for forcing Windows to be the de facto desktop OS. "

          But they did, as in "even if you ship a computer without windows you still have to pay it us the windows licence it doesn't use"

          Or as in "no, you can't ship a computer with both Windows and BeOs"

          1. veti Silver badge

            Re: So....

            Even at the height of the Browser Wars, Microsoft never had a monopoly that wasn't contestable. Linux first appeared in 1991: there was nothing to stop you from setting up your own computer manufacturing company, selling machines with Linux (or BeOS, or OS/2, or nothing at all) installed, and never paying Microsoft a dime.

            It was only if you wanted to use Microsoft's product that you had to pay their tax.

            How is that different from Tim's argument about Google?

            1. oldcoder

              Re: So....

              You paid even if you DIDN'T want Microsoft's product.

        2. Antonymous Coward
          FAIL

          Re: So....

          "They got in trouble for using their (fairly won) OS monopoly..."

          WTF?

          FAIRLY WON???? Citation needed!.. Please don't forget to include comprehensive references to at least (in no particular order): Digital Research, FUD, OS2, kernel obfuscation, HIMEM, undocumented ("illegal") opcodes, Lotus, United States v. Microsoft Corp., Wordperfect...

          1. Indolent Wretch

            Re: So....

            Thanks for that, my forehead hit my desk so hard I couldn't bring myself to respond.

            The shockingly blinkered nature of some of these peoples attitude to Microsoft's criminal behaviour over the years is just mind blowing.

            I mean OK guys, we get it, you think Google are the new Evil, even if that's true don't forget who introduced the damn concept.

        3. Indolent Wretch

          Re: So....

          But are they other products?

          Why should a product that lets you search web pages for information type A be considered a different product from one that lets you search web pages for information type B?

          It's all search.

          So is maps, so is hotel bookings, so is bus time tables and flight information, and ST:TNG bloopers.

          It's all searching for information on the Internet.

          You could argue that Google Plus is not search. But the others?

          Google is a search company funded by advertising /OR/ an advertising company made watchable by search. Either way I don't get to see why they should be limited in what they can search.

      3. BSOD

        Re: So....

        Today it's just as easy for someone non-techy to install another browser as use another search engine. That wasn't the case when M$ got whiptanged by The Beak.

    2. Alister

      Re: So....

      So....

      ..you were happy with IE bundled on Windows then?

      Sigh... The same old comparison being drawn.

      This is NOT the same. Nobody is forced to use Google as a search engine. It is a personal choice. Indeed, for IE / Windows users, it requires a user to consciously change from the default which is Bing.

      And even if you do use Google as your search engine, no one is forced to click on any particular one of the search results returned.

      If a company wants to appear at the top of a particular set of results, they can pay for a sponsored link, but even if they don't do that, they will still appear in the organic results depending on their relevance.

      Google does not hide or refuse to show links to competitors. What Google may do is give preference to their own services, but it does not force you to select them.

      1. This post has been deleted by its author

        1. Kubla Cant

          Re: So....

          "What Google may do is give preference to their own services, but it does not force you to select them."

          Actually, yes, they indirectly do. Ever tried the "I feel lucky" button?

          No, I've never tried it. Which is odd, since you seem to think we're all forced to use it.

          1. dkjd

            Re: So....

            "What Google may do is give preference to their own services, but it does not force you to select them."

            oh goody, I can de-install "play store" from my phone then?

            1. Jimmy2Cows Silver badge

              Re: So....

              oh goody, I can de-install "play store" from my phone then?

              Maybe, maybe not. But you aren't forced to use it. There are alternatives even if using them requires more work.

              You seem to be berating the maker of your phone OS for giving you easy access to other products that work with your phone OS...

            2. John G Imrie

              Play store

              Not so sure you can un-install, as I've never tried it. I do know that you can add other stores.

            3. david bates

              Re: So....

              Yes. As long as your phone manufacturer (not Google) allows you to unlock the boot loader.

              I've had three Nexus devices, two of which I've rooted (and Google did nothing to stop me rooting them, and even helped me find the instructions and software to help), and installed a non-google android build on, and then OPTIONALLY installed all the googly goodness I wanted.

              Or you could use the Amazon app store or side-load...Google wont stop you

            4. silent_count

              Re: So....

              @dkjd

              With every AOSP ROM which I installed on my previous phone (galaxy s3), you had to install Google's app bundle separately from the ROM. I don't know which phone you have but if you're asking if it's possible to have an android phone without Google's apps (play store included), the answer is absolutely 'yes'.

            5. Badvok

              Re: So....

              @dkjd: "oh goody, I can de-install "play store" from my phone then?"

              Err, yes, well at least disable/hide it on most phones. What was your point again?

        2. JimmyPage Silver badge
          Mushroom

          Ever tried the "I feel lucky" button?

          No.

      2. John Brown (no body) Silver badge

        Re: So....

        "but even if they don't do that, they will still appear in the organic results depending on their relevance."

        And that is the nub of the matter. Google are being accused of artificially increasing the rankings of their own services even when other sites might have come at the top of the organic search results.

        1. tom dial Silver badge

          Re: So....

          Maybe the only legal obligation Google has is the contractual one with its advertising customers to display the ads, modified by the legal requirement to drop links to some sites based on copyright infringement claims and (in Europe, at least) to exclude links to those claiming a right to be forgotten.

          What would be the legal source of a claim that Google should not display the "organic" results in whatever order it chooses as long as it sticks by its contracts with advertisers?

        2. tom dial Silver badge

          Re: So....

          "Google are being accused of artificially increasing the rankings of their own services ..": Why should they not, as long as that doesn't conflict with the agreements they have with their paying customers?

          1. Jim 59

            Re: So....

            "Google are being accused of artificially increasing the rankings of their own services ..": Why should they not, as long as that doesn't conflict with the agreements they have with their paying customers?

            No reason at all, so long as Google is open about the conflict of interest, and makes this clear on the search page.

            1. tom dial Silver badge

              Re: So....

              Me: Google are being accused of artificially increasing the rankings of their own services ..": Why should they not, as long as that doesn't conflict with the agreements they have with their paying customers?

              Jim: No reason at all, so long as Google is open about the conflict of interest, and makes this clear on the search page.

              Me: Which conflict of interest would that be? I do not know of any basis to think Google (also Yahoo, Bing, or any other search portal) has a duty to explain the order in which it presents general search results. Placement of paid advertisements are a different matter, one presumably controlled by contracts.

          2. John Brown (no body) Silver badge

            Re: So....

            "Google are being accused of artificially increasing the rankings of their own services ..": Why should they not, as long as that doesn't conflict with the agreements they have with their paying customers?"

            Mainly because they claim they don't do that. They clearly state that they tweak the algorithms to get the "most relevant" results for the user based on a number of factors and have i the past specifically stated they do not artificially raise the profile of any results. This means there is a user expectation that the organic results are fair and impartial.

            There's nothing stopping them putting their own services results up with the paid for/sponsored results rather than messing with the "trusted" results.

      3. Anonymous Coward
        Anonymous Coward

        Re: So....

        One of the issues with this and with "Given that you cannot exploit contestable monopolies there therefore needs to be no regulation of them. Sure, we do need to look at dominant market positions and decide whether that is a contestable market" is the customer and the person being exploited.

        The person who uses Google search is not the customer of Google and the dominance/monopoly position is to the users who get the product for free, and a pretty good one at that. If Google play their cards right they will do the minimum exploitation of their users as possible, even the opposite in spending money to make sure that the user stays with them.

        However the customer of Google is the companies that pay for ads and also, although not a paying customer, the company that ranks in their search engine. As Google have created a near monopoly on search which they don't want to exploit, they do want to exploit the consequence of that near monopoly by extracting whatever fee they feel from their advertisers. The advertisers don't have an alternative if they feel exploited due to the users not moving with them if they try to use a different service.

        When the monopoly is over your customers and they are the ones being exploited and a route for a competitor exists then the free market will decide. However having achieved a well deserved monopoly over their users they are free to exploit their customers which have no real correlation to each other... it's more complicated.

        1. tom dial Silver badge

          Re: So....

          Dear AC who posted "the customer of Google is the companies that pay for ads and also, although not a paying customer, the company that ranks in their search engine":

          Please explain with some degree of precision exactly why a "company that ranks in their search engine" but has not purchased ad space is in any way Google's customer. Exactly why should Google (or Bing or Yahoo, for that matter) not display whatever they wish, in whatever order they wish, as long as they honor the contracts they have with their paying customers. What law requires them to give away services for which they provide the facilities and for which they normally charge a fee? That they do so to a degree of their choosing is part of their business model and increases the value of their services to the paying customers, but it certainly is not obvious that they should be required to do so.

        2. Tim Worstal

          Re: So....

          True, it gets more complicated with dual facing markets. Which is why the last Econ Nobel went to Jean Tirole, who explains these things.

          Now, if anyone thinks the Commish is up to date with such economic research then I've a bridge in Brooklyn they might be interested in.

    3. Anonymous Coward
      Anonymous Coward

      Re: So....

      @LAF Big difference, IE is total shit where as Google search is actually a good search product and got there on merit.

    4. The Boojum

      Re: So....

      Personally, didn't give a damn. I just installed and used whichever browser(s) I wanted.

    5. Jim 59

      Re: So....

      Contestable monopolies cannot be exploited because to do so brings forward that contesting.

      In other words: don't worry about monopolies, the free market will sort them out. However, with a monopoly, there is no longer any free market in existence. Ergo, no sorting can occur.

      Examples are poor. The Chinese rare earth affair can be discounted as it was clearly not a monopoly in any recognizable form. Being the sole supplier in a market is not sufficient to have a monopoly. As for Rockerfella reducing prices - again, being dominant with a natural commodity is not a monopoly in itself, and Standard Oil didn't behave like one, according to the author.

      The Czech supplier having having a shrinking market share - this argument is so slight it almost proves the opposite of what the author intended. All it shows is that the monopoly is still being established.

      Google has several of the features of a monopoly in search:

      - they dominate the supply

      - they dominate in other related areas

      - they leverage these positions horizontally, each to strengthen the other

      - no effective market operates in these areas (search)

      - there has been a corresponding lack of innovation and change (in search) for 10 or 15 years

      and mostly:

      Google behaves as if it has a monopoly in search. It walks like a duck, it quacks like a duck...

      1. Dan Paul

        Re: So....Then it's a Duck

        Not a monopoly, and no one EVER forced you to use it.

        You made the choice to do so.

        1. Jim 59

          Re: So....Then it's a Duck

          Not a monopoly, and no one EVER forced you to use it. You made the choice to do so.

          Nobody said people are forced to use a monopoly. You may not want the item at all.

      2. Tim Worstal

        Re: So....

        Excellent, so you agree with me then?

        "In other words: don't worry about monopolies, the free market will sort them out. However, with a monopoly, there is no longer any free market in existence. Ergo, no sorting can occur.

        Examples are poor. The Chinese rare earth affair can be discounted as it was clearly not a monopoly in any recognizable form. Being the sole supplier in a market is not sufficient to have a monopoly."

        There's two separate questions here.

        1) What is a monopoly?

        2) Is Google one?

        You have come to the same answer I have on 1). There's a difference between being sole supplier and being a monopoly. We just use different words for it, me using the formal jargon of "contestable".

        Good, so there we agree.

        On 2), we disagree, is Google a contestable or non-contestable one. OK, no worries, opinion journalism would be pretty boring if we all agreed on everything.

      3. naive

        Re: So....

        This answer is quite amazing, perhaps you could enlighten the world how google does all this.

        - they dominate the supply

        They do not. There is, and was, quite some competition. Perhaps google became dominant because they thought a bit further and offered services which are so good people can not ignore them ?

        - they dominate in other related areas

        Same story. Every one can build a cloud, image databases, a mobile phone OS or even self driving cars. Be the best and the position of becoming a dominant market leader just happens.

        - they leverage these positions horizontally, each to strengthen the other

        That is what they call Synergy. Companies do risky and expensive take overs to create this.

        - no effective market operates in these areas (search)

        There is a very effective market, namely a market of billions of well informed users. Ever seen a dropbox commercial ?, i guess not but still it is widely used, because it is so good.

        - there has been a corresponding lack of innovation and change (in search) for 10 or 15 years

        Same point. Get kickstart capital. Hire *good* people, give them space to create and *implement* innovative ideas, and be successful.

        Punishing google, is rewarding the mediocrity of its competition. Perhaps google found a way to manage the company in such a manner that good ideas are not chocked by layers of management, next quarter profit and mediocrity in general. The real monopoly is somewhere else. Google made a mobile OS, and now 80% of smart phone users have to pay MS $10 for the ability so a windows PC can read its photo gallery.

        So perhaps you are right after all. Google has a monopoly in being better than its competition, and not because of a dysfunctional markets shut closed by patent trolls.

    6. jonathanb Silver badge

      Re: So....

      Yes, because every operating system these days ships with a web browser, and it would be very difficult to download Firefox without one.

      1. Richard Plinston

        Re: So....

        > and it would be very difficult to download Firefox without one.

        http://www.mattsilverman.com/2009/06/how-to-download-firefox-without-a-web-browser.html

        1. omnicent

          Re: So....

          Yes because CLI is so easy for non-techies.....

    7. Yag
      Devil

      Re: So....

      ok, I'm wrong, my bad. Google does not *force* anyone to use their services.

      However, they give a strong emphasis to them in their search engine, which is indeed a logical business decision :

      - Looking for "email"? Google mail is the first answer

      - Looking for "maps" (or typing a physical address) ? Google maps this time

      - Looking for "shopping"? Google shopping

      Now, are those results biased by design (which would be indeed Evil), or because of a snowball effect? (people using google as their search engine are more likely to use other google services, ranking those services further up.)

      - About the "I'm feeling lucky" button :

      Very old statistics (2007 is very old in the Internet sense) shows that this button was used in roughly 1% of the searchs (obviously none of them performed by the demographic of El Reg's readers).

      This button was supposed to cost google 100M$ in loss of advertising revenue at the time, giving a rough idea of the sheer amount of requests this tiny "1%" actually is.

      And most of you are awful liars when saying you never used it : you HAD to try the "french military victories" bomb with this button at least once...

      1. Richard Plinston

        Re: So....

        > Now, are those results biased by design

        Yes. The results page is divided up into several sections, separated by rule offs. The first section is related advertising: paying the bills. The next section(s) may be 'in the news' or 'image results' or similar and then there are the general results.

        Of course Google advertises its own services alongside other paid adverts.

        Your complaint (and the EU one) is like complaining that a commercial TV station shows promotions for its own programs and doesn't show (free) promotions for programs on other stations.

  2. toughluck

    Sigh indeed...

    Minerals are fungible. Services are not.

    1. Anonymous Coward
      Anonymous Coward

      Re: Sigh indeed...

      You can get a cream for that.

    2. Anonymous Coward
      Anonymous Coward

      Re: Sigh indeed...

      Fungible !

      Do I need a pig to search for that ?

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