The Question of Remedies in a Google Antitrust Case

by on July 1, 2011 · 0 comments

It remains unclear how interested the Federal Trade Commission (FTC) is in bringing a formal antitrust action against Google, but we at least know that inquiries have been made. I suspect these inquires are far more serious than whatever the agency is fishing for with its new Twitter inquires. After all, as I note in my latest Forbes column, “Google isn’t even a teenager yet (having only been founded in September 1998), but the firm’s rise has been meteoric and it has made a long list of enemies in the process. Practically every major player in the Digital Economy… is gunning for Google these days, both in the commercial and political marketplace.” In this sense, it’s not surprising the FTC might take a keen interest in the company with so many competitors complaining.

Still, I just can’t find much merit in an antitrust case against Google since, as I noted in my column, “The firm’s success seems tied to high quality products that users prefer over rival services. Importantly, barriers to entry are low: there’s nothing stopping new entrants from innovating and offering competing online services to match Google.”

Regardless, instead of arguing about the merits of an antitrust action against Google, let’s consider the more interesting, and I think intractable, question of remedies. Here’s what I had to say about that in my Forbes essay:

[possible remedies] include a so-called Federal Search Commission that would monitor search results to achieve “fairness” or “search neutrality.” Some academics have also suggested a possible mandatory “right of reply” for companies or consumers if they don’t like what a search for their name reveals. This is the equivalent of a Fairness Doctrine for search results.

Another idea, borrowed from Microsoft’s antitrust saga in Europe, is a “browser ballot” for specialized search results like maps, stock reports and weather. Just as Microsoft was required by European antitrust officials to offer a “ballot” of alternative browsers before consumers first got online, Google might be forced to show several alternative links for search queries if Google-owned sites are also shown in the results.

Even if ballots could be implemented without reducing the usability of search engines—a tall order—it would be difficult, if not impossible, to incorporate all the choices available to consumers. And if government only chose a few, it would be picking winners and losers. Better to let markets decide.

Making Google’s proprietary search algorithm more transparent also sounds great until you realize it would make it easier for spammers and scammers to game search results.  Search regulation might also lead to dangerous forms of speech control. Just as the Fairness Doctrine was abused by politicians in the Analog Era, search-tinkering will likely prove too tempting to pass up.  For paternalistic policymakers, search regulation could be an opening to do what they’ve always wanted: “clean up” the Net.

These are just some of the problems with the remedies that have been proposed. Please read some of the essays by Geoff Manne and Josh Wright listed down below for a more in-depth exploration of these issues. Of course, we’re still very early in this process and, if a case against Google moves forward, I suspect we’ll see a number of other possible remedies suggested.

Regardless, I can’t help but have a vague sense of unease about the mere thought of Uncle Sam as Search Czar. Again, from my Forbes essay:

These regulatory solutions would put government bureaucrats in control of the day-to-day management of one of the most dynamic digital technologies ever invented. Treating Google like an essential facility to which all must have equal access on regulated terms would mean subjecting the Internet, still largely free of government control, to public utility-style regulation. It’s hard to imagine that regulating search like local sewage service will benefit consumers in the long run. Government simply doesn’t have a very good track record of steering markets—especially dynamic, fast-evolving ones like this—in more innovative directions.

I think consumers will be better served by Google and its many competitors spending their time focused on creating innovative new products and services rather than making Washington bureaucrats happy.


Additional Reading from TLF Contributors:


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