Google Chrome & the Coming Antitrust Suits

by on September 2, 2008 · 10 comments

Google is entering the browser wars today (if any such war still exists) with the launch of Chrome, its new web browser.  I’m glad to see more competition in browsers as I think—and I hope everyone else agrees with me—that Firefox is the only real game in town. I know that Internet Explorer is more popular, but that seems to only be because it is shipping with every Windows PC and because many enterprise web applications require IE’s non-standard browser. Firefox is preferred browser for anyone who works with the web regularly and has bothered to compare browsers.

One implication of this foray by Mountain View into the browser arena is that—should Chrome be at all successful—they will soon be accused of using their supposed search monopoly to squeeze out competition from IE and Firefox. That is assuming that anything in Chrome favors Google’s search, like making it the default search engine for the browser, which I’m sure it will be.

It’s funny to think that Microsoft, the poster-child from antitrust suits, could be the one launching such a suit. Just a few short years ago we saw Microsoft scoffing at the very notion of antitrust or monopoly power, arguing that it in no way used its market share to its own advantage. Now we see Redmond lashing out against Google as a monopolist. At a recent conference I had the unpleasant experience of watching a panel on online advertising devolve into a fight between the Microsoft and Google reps over whether Google was a search and advertising monopolist.

To be fair, Google has sued Microsoft over things as petty as Vista’s built-in MSN/Windows Live search.  They may soon regret this suit over built-in search as Microsoft could run a find/replace on that lawsuit and turn it into the “Chrome case.”

Both companies should put a leash on their legal teams and look at the implications of these lawsuits on the overall landscape of public policy. By constantly using antitrust against one another, both companies legitimize the underlying notions of antitrust, namely that a company can truly choke out competition by virtue of having a large market share.

But this isn’t true. Apple has made serious gains against Microsoft in the last two years, growing to roughly 10% market share.

Similarly, Google remains very vulnerable to technological change. Anyone who figures out a decent way to search the growing amount of audio and video content on the web will be on their way to blowing Google out of the water. Sure, it will take A LOT of money to catch-up to Google because of its tremendous infrastructure, but the right technology will find money, whether it be from venture funds or from a buy-out by Microsoft, Yahoo, or even relatively new players in online advertising like Newscorp.

We’ve seen with both companies use of antitrust for what it really is, and what antitrust always is, a way for companies to beat up on each other without actually competing in the marketplace. Instead of working on actually developing a superior or equal search program, sue Google. Instead of marketing your desktop search effectively so more people adopt it, sue Microsoft.

But again, both companies need to reconsider what they’re doing. Every time they endorse antitrust as a legitimate public policy tool, they lend credibility to the efforts of their competitors to sue them for antitrust violations. Instead, both companies ought to be touting the virtues of competition and explaining why their supposed monopolies are vulnerable to market competition just like any other business. It’s to their advantage, it’s better for the marketplace, and it’s the truth.

  • http://www.techliberation.com Adam Thierer

    Great post Cord. And you are right to warn of the looming antitrust storm clouds gathering re: Google. This will just fuel the fires of calls for intervention. But God only knows how one can claim any sort of consumer harm here. Let's see: More entry and innovation at zero price to the public… sounds like a pro-consumer development to me!

  • http://www.techliberation.com Adam Thierer

    On another note, however, I do wonder what impact this will have on Firefox. After all, most the support (85% in 2006) for the Mozilla Foundation comes from Google. Here's how the Wikipedia entry for the Mozilla Foundation sums it up:

    >> In 2006 the Mozilla Foundation received US$66.8 million in revenues, of which 61.5 million is attributed to “search royalties”. The foundation has an ongoing deal with Google to make Google search the default in the Firefox browser search bar and hence send it search referrals; a Firefox themed Google search site has also been made the default home page of Firefox. A footnote in Mozilla's 2006 financial report states “Mozilla has a contract with a search engine provider for royalties. The contract originally expired in November 2006 but was renewed for two years and expires in November 2008. Approximately 85% of Mozilla’s revenue for 2006 was derived from this contract”; this equates to approximately US$56.8 million. <<

    [ http://en.wikipedia.org/wiki/Mozilla_Foundation... ]

    Now, I am not saying that Google is going to cut and run tomorrow, or even next year, in terms of its Mozilla support. Nonetheless, one wonders if that level of support will be sustained over the long-haul. Of course, Mozilla might be able to make it up in other ways, or find other methods of financing to bring in some $$$ to support basic operations.

    But the real question is: How much of Firefox's current 19% market share will be stolen away by Google faithful as Chrome is rolled out? After all, just as Microsoft and Apple have their fanboy camps, so too does Google. Moreover, MS and Apple focus on seamlessly integrating services across their platforms, and Google is moving in that direction as well; the addition of a browser is just another piece of the puzzle. But where does that leave Firefox? Will it lose share to Chrome or will it remain stable as Chrome eats into IE's share?

    Interesting days ahead! But all this competition is great and I look forward to now using these different browsers to see how they stack up.

  • http://www.techliberation.com Adam Thierer

    Sorry, one other question: Does anybody know how browser market share stats are compiled? Specifically, with so many people running multiple browsers, how is “share” determined? It strikes me this is going to become a bigger problem in coming months with the rise of Chrome.

    I use Firefox for 85-90% of my browsing, but still rely on IE for a few tasks. I can imagine using Firefox, IE and Chrome together in coming months and years.

  • http://www.cordblomquist.com cordblomquist

    Websites collect a lot of information when you visit them including which browser you're using. I assume that market share information can be determined through honest reporting of this data by sites like Google.

    Is some of this data based on polling? If so, does the questioning allow you to say that you use Firefox 95% of the time and IE 5% of the time, cause that would be my answer. The data shouldn't be lumped into one group or another as though they're mutually exclusive.

  • http://www.cordblomquist.com cordblomquist

    I'm sure Google will keep the deal with Firefox going as Firefox will remain popular for a while, even if Chrome is a decent product. There is such a large community of Firefox developers and a huge array of plug-ins that I just don't see its popularity waning too quickly.

    If Chrome is built using Mozilla code can it be used for commercial purposes? What are the limits of the license on that code if any? What would define commercial purposes? Would you have to sell Chrome or would using it to drive traffic back to Google also qualify?

  • http://www.tc.umn.edu/~leex1008 Tim Lee

    As a Safari user, I don't agree with your contention that “Firefox is the only real game in town.” Safari has many of the same advantages–speed, standards compliance–as Firefox. Safari doesn't have the extensive library of plugins Firefox does, but IMHO that's more than made up for by its use of Mac-native widgets and UI conventions.

  • http://www.cordblomquist.com cordblomquist

    I find the plug-ins to the be the indispensable part of Firefox. I've used Safari and I do make a point of trying it out again on occasion, but I just don't notice a different in browsing. I'm on a PC however, not a Mac, so perhaps your experience is better because of that. I still think that Firefox is the only game in town in terms of a standards compliant browser that has a developer community around it making it much better than the basic browser.

  • Ryan Radia

    Cord makes a good point–Safari may be faster and more standards-compliant than Firefox, but it lacks the extensive library of add-ons that make Firefox the “only real game in town.”

    Double-click to close a tab, select and drag for a new tab/search, mouse gestures, click and drag scrolling, full page zoom with bicubic interpolation, NoScript. AdBlock Plug with Filterset.G are just a few reasons why Firefox is king of browsers. While Safari can be modified to include some of these features, it's just not as tweakable as Firefox. Now that FF3 passes the ACID2 test and manages memory quite efficiently, it outclasses other browsers without question in my mind.

  • Ryan Radia

    Cord makes a good point–Safari may be faster and more standards-compliant than Firefox, but it lacks the extensive library of add-ons that make Firefox the “only real game in town.”

    Double-click to close a tab, select and drag for a new tab/search, mouse gestures, click and drag scrolling, full page zoom with bicubic interpolation, NoScript. AdBlock Plug with Filterset.G are just a few reasons why Firefox is king of browsers. While Safari can be modified to include some of these features, it's just not as tweakable as Firefox. Now that FF3 passes the ACID2 test and manages memory quite efficiently, it outclasses other browsers without question in my mind.

  • http://robbieclarken.com/2009/01/18/eu-thugs-are-at-it-again/ EU thugs are at it again « Robbie’s Blog

    [...] using non-IE browsers so it is not like the alternatives are obscure. Ironically, antitrust will probably be used on Google at some stage if they start promoting their Chrome browser as an alternative to IE. Installing [...]

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