Wednesday, April 18, 2007

Google-opoly? Complaints from All Corners about Google's Deals

BusinessWeek provides an excellent analysis of recent deals and acquisitions by Google, deals which are resulting in complaints from Microsoft to regulators about potential anti-trust violations as well as similar concerns about market dominance from NETCompetition.org. BW dismisses concerns about anti-trust violations in the Doubleclick deal by pointing out that their main focus is not on ad auctions: at least for now there will be no auctioning off of Google ads on the Doubleclick network. As the article notes, "Even with a Google-owned DoubleClick, publishers can still sell their display ads themselves and set the prices however they want." But the concerns about dominance are underscored by Google's announced deal with U.S. radio giant ClearChannel to sell 30-second ad spots on their radio stations via their dMarc radio advertising platform.

Well, first let's put aside the somewhat unfortunate claims of anti-trust violations from a company that owns more than 90 percent of PC operating systems and word processing software worldwide and focus on the real question: is Google creating unfair business practices? This can get gray pretty quickly but overall I think that the answer is no. The opportunity to build or buy infrastructure that makes the most out of contexts in Web content has been around for more than a decade. Where most companies opted to focus on traditionally marketed intellectual property Google has been the only leading company to focus almost exclusively from its beginnings on creating and owning contexts for content. While Yahoo is excelling in amassing content from both users and publishers it dropped the ball on search technologies many times and is only now beginning to mount a serious challenge to Google's ad technologies and partnerships. Microsoft has had extremely ample time to develop competitive challenges to Google but has chosen instead to develop a very split strategy that tries to placate status quo-sensitive enterprises and publishers while also trying to develop improving but underdeveloped search and ad technologies.

So to my ears I hear some people saying, "Hey, that's not fair, Google figured out what the leading value proposition for online content would be for the next few decades before we did." Is Google aggressive? You bet. Does some of the "don't be evil" charm wear a little thin at times these days? Certainly. Dominance can easily turn into unfair practices, so it would not be right to give Google a complete clean bill of health for all time in their acquisition plans. But for the most part the ball is in the courts of Google's competitors to build a better mousetrap. And that's the way that it should be, we're told.
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