A new Justice Department investigation is looking into the business practices of Google. An antitrust investigation of Alphabet Inc.’s Google could lead to a potential break up of a company that dominates the search space. Such an investigation opens the door for government regulation into the big tech space. Google and other big tech companies have frequently been accused of antitrust and censorship practices. In 2013, Google settled with the FTC claims over similar accusations. But the FTC relented when Google agreed to make numerous small changes.
Now the FTC is directing antitrust complaints levied against Google to the DOJ. The move drastically escalates the situation between Google, Big tech, and government agencies.
A DOJ task forced formed in February aims to investigate Google’s search and advertising business. Advertising revenue is Google’s main source of income. The company has come under scrutiny over the years for being a persistent monopoly. In fact, Google has been accused of shoving organic search to the basement as a way to push more advertising agenda. This alone compromises the integrity of search results. Last March, Google was accused of making cosmetic changes to mobile search results as a way to conceal ads. Given competition hardly exist, Google’s practices go mostly unchecked.
The investigation was first reported by the Wall Street Journal. So far, the investigation into Google is not a formal proceeding. But if the situation plays out like many believe it will, this will become the first major Big Tech antitrust investigation under President Trump. And it’s sure to send shockwaves throughout all of Silicon Valley, a tech-heavy region that doesn’t have a kind relationship with the President.
Google has hardly done itself any favors with the U.S. government. Last year, Google employees accused the company of helping China censorship agendas. Given today’s U.S./China climate, that’s unlikely to serve in a helpful way when it comes to investigations into business practices.
Google has been in business since 1997 and currently wears the crown for the largest search provider. Google has nearly 65% of market share, with Microsoft’s Bing search trailing far behind.
Censorship controversies have plagued Google and Big Tech. A recent report accused Facebook of censoring conservative voices on its social media network. Accusations that PayPal censors merchants based on social justice values have run rampant over the last six months. And government agencies have long persecuted Facebook over privacy issues.
But Google’s anti-competitive advertising practices could be the largest undertaking and result in the most impactful change. Google is a massive portal for information. The amount of power they hold is uncanny and to a degree, unsafe. The problem, of course, is that big government rarely solves issues. They often make problems worse.
For Google and Big Tech, Trump is hardly their worst fear. If a Democrat wins in 2020, scrutiny into Big Tech business practices certainly appears to elevate. Cory Booker, Amy Klobuchar, and Elizabeth Warren all support breaking up Big Tech. In fact, Warren, a potential front runner Democratic Presidential candidate, is currently running “break up big tech” billboard advertisements in Silicon Valley.
“Today’s big tech companies have too much power — too much power over our economy, our society and our democracy,” Ms. Warren wrote in a Medium blog article.
Even some Silicon Valley elites are turning on one another.
“TripAdvisor remains concerned about Google’s practices in the U.S., the E.U. and throughout the world,” Stephen Kaufer, the chief executive of TripAdvisor, said in a statement, referring to the European Union. “For the good of consumers and competition on the internet, we welcome any renewed interest by U.S. regulators into Google’s anti-competitive behavior.”
Kaufer is one of many formal complaints levied against the search giant.
Joseph J. Simons, the FTC’s chairman, said the original FTC Big Tech taskforce was created because technology companies present an array of new, unchartered challenges.
Google and Facebook are likely to argue that they do have competition. People are free to use any search or social media platform they like. However, Apple’s IOS is a main conduit for both platforms connections to new and old users. Both Big Tech platforms are built directly into IOS. Without at least app approval through Apple, new platforms have little chance at survival. And when new platforms do get over the proverbial hump, they are often bought out by Google or Facebook.
Author: Jim Satney
PrepForThat’s Editor and lead writer for political, survival, and weather categories.
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