Antitrust

While Google may be slowly losing the legal battle over the amended Google Book Settlement Agreement, the protracted legal process and Google's political "slow rolling" of the broader process are enabling Google to win the much larger marketplace war for global dominance over digital content and distribution.

• From a big picture perspective, Google is cleverly "playing" and slow rolling both rights holders and the DOJ because Google understands that time is on Google's side, not the side of rights holders or the Government.
• Google's market dominance is only growing and becoming more irreversible, and copyrighted material is only being devalued as long as Google is the only entity that can copy it without permission and currently commercialize it for themselves via search without any compensation to rights holders.   

Takeaway #1: DOJ still strongly objects to the proposed amended settlement (ASA).

There's new evidence from Google itself, that Google's search results are not neutral, as Google has long publicly represented them to be, and as Google expects everyone on the Open Internet to be.

• (Kudos to famed trustbuster Gary Reback for unearthing the core information that I spotlight in this post; it is from Mr. Reback's friend-of-the-court brief for the Open Book Alliance, which opposes the Google Book Settlement. Don't miss pages 14-16.)  

Google now admits that its search results are not neutral despite longstanding public representations to the contrary.

Most have missed that there's a big antitrust showdown happening this week. 

• February 4th, the DOJ must file a second round of comments on the Google Book Settlement 2.0 with Federal District Court Judge Chin, after Google almost completely ignored DOJ's substantial legal objections in its Book Settlement 2.0 revision.   

The Google-DOJ showdown in a nutshell:

In the last year, Google has taken almost a third of the search revenue market share that they did not have before -- per recent company reports.

• In other words, Google's search revenue share increased from 90% in 4Q08 to 93% in 4Q09.
• To understand the math, supporting numbers,and links behind this estimate see the end of this post.

Google's 4Q09 earnings release also shows Google is exercising its market pricing power at the expense of web publishers by reducing the revenue share percentage shared with web publishers (i.e. raising prices) because web publishers have no where else to go; please see the illuminating analysis by Amit Agarwal of Digital Inspiration blog who deserves credit for this important insight.

My vote for quote of the month on Google was "If Google can drop China, it can drop you."

This profound razor-sharp insight was said by Howard Shelanski, speaking for himself, not the Federal Trade Commission, at the Free State Foundation's annual conference at the National Press Club in Washington DC on Friday. 

Mr. Shelanski is currently Deputy Director of the Bureau of Economics at the FTC, a former Chief economist at the FCC, and a widely respected economist and antitrust expert. 

I am spotlighting his quote because it sheds light on the broader implications of the world censorship policeman role Google is asserting for itself in the world. 

If Google is going to take the position that it unilaterally will withdraw access to its search engine from hundreds of millions of Chinese, if the Chinese Government does not do what Google tells it to do, it puts everyone else in the world on notice that Google has the power, interest and wherewithal to withdraw access to its search engine to anyone who might disagree with Google politically.      

Google posted "Google's Privacy Principles" for International Privacy Day and made a pretty sweeping official representation to the public in its announcement post: 

• "We've always operated with these principles in mind. Now, we're just putting them in writing so you have a better understanding of how we think about these issues from a product perspective."   

Is this a factually accurate and fair representation of Google's past and current privacy practices?

If it is indeed a true statement:

January 27, 2010

For Immediate Release

Contact: Scott Cleland

703-217-2407

Media@GoogleMonitor.com

GoogleMonitor.com Launches Today

Google generated probably the strongest annual revenue growth, 17%, of any large U.S. company this past quarter. 

• Given that Google is exceptionally non-transparent, the minimal guidance and insight that Google is required to provide as a public company always provides a rare glimpse into what is really going on at Google. 

What are the big takeaways from the earnings call?

First, Googleopoly continues to gobble revenue market share at a voracious rate because we know Google's revenues are up 17%, and Google's only significant competitors, Yahoo and Microsoft are continuing to lose ground, (as Yahoo is expected to report a revenue decrease on Tuesday so its search revenues can be assumed to badly lag Google's 17%, and Microsoft Bing's modest search share gains are not keeping up with Google's torrid search growth in a weak economy.)

In a brief but very important WSJ story, Google abandons any pretense that it is a neutral search engine/advertiser. See the WSJ piece: "Google advertises its China position with search ads."

While I generally disagree with ZDNet's open source columnist, Dana Blankenhorn's views, I regularly follow what he writes and respect his analysis and clarity of thought. 

Given all the talk of Google's many antitrust issues and Google's own denials that it is a monopoly, Mr. Blankenhorn's candor as a Google ally, was refreshing in his piece: "Open source and the Google Cloud:"