New Antitrust Boss Has Already Expressed Concerns About Google

from the so-much-for-eric-schmidt's-relationship... dept

There have been some folks in the press who have repeatedly pointed out Google CEO Eric Schmidt's close relationship with President Obama to suggest that Google should be "protected" from government regulation. However, there's little to suggest that's necessarily the case. Plenty of folks who feel strongly anti-Google have close relationships with the administration as well. And, as Bloomberg notes, Obama's nominee for antitrust chief, Christine Varney, has recently described Google as a likely antitrust problem, noting the company "has acquired a monopoly in Internet online advertising." Of course, that's wrong on many levels (it doesn't have anything close to a monopoly in online ads), but this should at least serve as evidence that reports of Google's "control" over the administration isn't nearly as strong as some have been suggesting.
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Filed Under: antitrust, christine varney, obama
Companies: google

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  1. identicon
    Anonymous Coward, 19 Feb 2009 @ 12:35pm

    Abuse of mkt. power is illegal -- "monopoly" is just shorthand

    Ms. Varney is using antitrust shorthand when she talks about Google's monopoly. Under antitrust law, she is almost certainly right in saying that GOOG can raise and lower prices at will, if only within a relatviely modest band. Under that definition, GOOG has market power and can be prosecuted under antimonopoly laws.

    GOOG of course does not literally have all of the market, but its ubiquity and resultant precision targeting are such that new entrants who could give them a run for the money are -- well, nowhere to be seen.

    At some point, when barriers to entry get high enough and pricing power gets big enough, companies start abusing their power. We don't know for sure if Google has reached that point but we should find out if the Tradecomet case goes to trial.

    Most people thought there was no Microsoft monopoly, either, back in the day. If Google engages in tactics like those MSFT once used they will be brought to heel. The biggest problem is we won't know for sure unless there is a prosecution and trial that brings out all the nasty stuff, just as it did in the Microsoft case. The media was for the most part shocked and shocked even more to find out things that had been whispered around the Valley for years.

    Let's remeber that Christine Varney was a major consultant for Netscape duruing the Microsoft trial and talked to reporters more than a few times during the case. She knows how these things play out from up close.

    The parallels are striking. Just wait and see. My money is on Varney for the win.

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