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Antitrust

Study shows websites deny Google competitors web-crawler access to their sites

Have Penn State researchers stumbled upon a Google-DoubleClick anti-competitive smoking gun?  

PCWorld flagged some very troubling new research findings pertinent to the FTC/EU reviews of the Google-DoubleClick merger by Penn State researchers in its article "Google Favored By Web Admins."  

  • Penn State researchers: "Web-site policy makers are playing favorites, and Google is the big beneficiary, say Penn State researchers."
  • ""We expected that robots.txt files would treat all search engines equally, or maybe disfavor certain obnoxious bots, so we were surprised to discover a strong correlation between the robots favored and the search engines' market share," said C. Lee Giles, the David Reese Professor of Information Sciences and Technology at Penn State who led the research team that developed BotSeer, in a statement."

 Why is this significant?

Analyzing the FTC-EU divergence in reviewing the Google-DoubleClick merger

Ironically, just as the EU is gearing up to conduct an "in-depth investigation" of the Google-DoubleClick merger, the FTC investigation is apparently wrapping up with a whimper. What accounts for this divergence in approaches to this merger review?

The first and obvious explanation is differences in the process and timing.

EU launches "in-depth investigation" of Google-DoubleClick merger; What it means

EU antitrust authorities have launched a rare "in-depth investigation" of the Google-DoubleClick merger. What does this action mean? 

First, in calling Google and DoubleClick "the leading providers" respectively of online advertising/intermediation services and ad serving technology, the EU has tipped its hand in its assessment of a central fact in the investigation that it views these two companies as #1 in the world in their specialties. This obviously troubles Google as they have portrayed DoubleClick as a minor player because of its smaller revenue base in the $300m range. The EU obviously did not buy that Google spin.

Second, the EU rejected Google's blanket assertion that "the parties' activities do not overlap" which is Google's fancy way of saying Google and DoubleClick are not competitors. Well the EU pointedly rejected that Google assertion of fact in stating: "The Commisssion will, in particular, investigate whether without this transaction, DoubleClick would have grown into an effective competitor of Google in the market for online ad intermediation." The obvious implication of this statement is that the EU does see Google and DoubleClick as competitors. And it has framed the question in a way that must trouble Google, which is that they are analyzing the merger through the lens of how competition would develop without this merger. hmmm 

Google-DoubleClick: Great new antitrust study on why privacy is relevant to this antitrust review

I was very impressed with Ohio State law Professor Peter Swire's insightful analysis of why, in the context of the FTC antitrust review of the Google-DoubleClick merger, privacy harms are relevant to the traditional antitrust analysis.

  • "In brief, privacy harms can reduce consumer welfare, which is a principal goal of modern antitrust analysis. In addition, privacy harms can lead to a reduction in the quality of a good or service, which is a standard category of harm that results from market power. Where these sorts of harms exist, it is a normal part of antitrust analysis to assess such harms and seek to minimize them."
  • "To the extent proponents of the merger seek to justify the merger on efficiency grounds, such as personalization, then privacy harms to consumers should be considered as an offset to the claimed efficiencies."

In my Googleopoly analysis and my Senate Judiciary Subcommittee testimony on the Google-DoubleClick merger, I viewed the massive aggregation of customer clickstream data to be highly anti-competitive as it would create a tipping point and unsurmountable barriers for others to compete.

American Antitrust Institute calls for FTC to block Google-DoubleClick

The American Antitrust Institute, an independent non-profit advocacy organization just released its white paper:

Like my Googleopoly analysis from this July and my Senate Judiciary Subcommittee testimony in October, the aai concludes that Google and DoubleClick are indeed direct competitors and that: "the merger presents a relatively straightforward case for challenge under the horizontal and non-horizontal merger guidelines."

  • Moreover, the aai stated: "We also see a risk of significant foreclosure effects from Google's control over DoubleClick's publisher and advertiser tools and integration of those tools with Google's dominant search engine and contextual advertising network."

Bottom line: This merger obviously raises serious anti-competitive issues and I continue to believe it should be blocked, but that does not mean that I still think it will be blocked by the FTC -- I no longer do.

More eBay-Skype hypocrisy!

Isn't it illuminating that eBay, the online auction monopoly with 95% market share per Jupiter Research, and the owner of Skype that is lobbying hard for regulation and legislation to force the "unlocking of phones" and mandate net neutrality regulation -- is so uncooperative with law enforcement trying to crack down on organized theft?

  • Could it be that calling for others to be "open" is just code, cover and justification for stealing other's property or property rights?

Reuters reported last week: "U.S. retailers want online sellers to fight theft." 

  •  "U.S. retailers and police called on Congress on Thursday to require online auction sites such as eBay to post the serial numbers of items for sale to help crack down on gangs of professional shoplifters." 
  • ""Operators of sites such as eBay have historically failed to provide any meaningful information to retail investigators," said Karl Langhorst, director of loss prevention for Randall's and Tom Thumb stores, a division of Safeway Inc.""

Seems like more hypocrisy and situational ethics from eBay, where they seek corporate welfare from government, while not cooperating fully with law enforcement to fight "organized theft."

  • Maybe there is "Honor among thieves."

What do Google's earnings tell us about the FTC/EU review of Google-DoubleClick? and Google?

In addition to delivering another spectacular quarter of revenue growth, Google provided some new and current information that is highly relevant to the FTC and EU review.

First, compelling evidence of Google's market power is mounting.

Moveon.org's Google coverup?

Art Brodsky's of Public Knowledge recently posted his long defense of Moveon.org and Google for their blocking the free speech of U.S. Senator Susan Collins.

  • Brodsky claims that Moveon.org has called off its trademark protection dogs and is now allowing Google to place anti-Moveon.org ads now that they blocked last week at Moveon.org's urging.
    • How skulkingly magnanimous of them!

What appears to be missing from this sleight-of-hand mea culpa, is Google/Moveon.org or both of them:

  • admitting they made an egregious mistake in conspiring to block the free speech of a U.S. Senate candidate;
  • taking full responsibility for the Internet free speech censorship;
  • pledging it won't happen again; and
  • explaining that they have taken sufficient actions (policy changes) so it won't reoccur.

I doubt a congressional panel, the press or the blogosphere will drop this issue just because one of Google's Poodles organizations, Public Knowledge, posted a preemptive defense on the Huffington Post to try and frame this issue before their "progressive" base got a whif of their week-old anti-free speech droppings.

Mr. Brodsky also claims that Google and Moveon.org have never limited free speech before.

Let's see how principled Google's Open Internet Coalition is on protecting free speech

How timely for the Google-backed Open Internet Coalition to be writing Congress asking for Congressional hearings on allegations of censorship of free speech on the Internet.

Google bans Senator Collin's anti-Moveon.org ads -- Google's "Free Speech" double standard

Robert Cox, the Founder and President of the Media Bloggers Association, a non-partisan professional standards group, reports that Google has blocked the running of U.S. Senator Susan Collins' anti-Moveon.org ads on Google.

  •  "Internet giant Google has banned advertisements critical of MoveOn.org, the far-left advocacy group that caused a national uproar last month when it received preferential treatment from The New York Times for its “General Betray Us” message."
  • "The ads banned by Google were placed by a firm working for Republican Sen. Susan Collins’ re-election campaign. Collins is seeking her third term."

    Google has a particularly tortured concept of "free speech" if it is willing to editorially ban Republican speech that opposes its most important and high-profile lobbying ally in the net neutrality fight.

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