Does Google have a Monopoly on Search?

In a recent article written by one of our SEO experts Chris Smith, it was suggested that 2015 could be the year when Google would finally be dethroned as the undisputed king of search. The argument that Google has monopolised the search industry is one that never seems to go out of fashion, but does it have any validity?

In a recent article written by one of our SEO experts Chris Smith, it was suggested that 2015 could be the year when Google would finally be dethroned as the undisputed king of search. The argument that Google has monopolised the search industry is one that never seems to go out of fashion, but does it have any validity?

Whilst it is clear that Google is certainly the market leader, a recently leaked report written by the Federal Trade Commissions’ Bureau of Competition suggests that its domination of the U.S market at one time bordered on becoming an unfair monopoly. Since the report was leaked, the findings have provoked a flurry of interest. However, is it correct to jump on the “Google hating” band wagon, or is there more to the story?

Google’s U.S Market Share

So why would it be necessary to investigate Google’s position in the market? Surely they can’t be that dominant? According to statcounter, in January 2015 Google accounted for 74.8% of all core search queries in the United States. Over the same time period, Google’s primary competitors Bing and Yahoo accounted for just 12.4% and 10.9% respectively.

Based on these statistics, it doesn’t seem unreasonable for the Bureau of Competition to make sure that Google’s current standings do not border on becoming unfair, an accusation that they have always denied, saying that competition is “just a click away”.

FTC Enquiry

Rather than speculate on whether Google has monopolised search, why not ask the experts? Thankfully for me, as I really wouldn’t know who to call otherwise, the Federal Trade Commission’s Bureau of Competition looked into these allegations very recently.

After complaints made by Google’s chief search rivals, Yahoo and Bing, the FTC conducted a thorough investigation into Google’s practices for a year and a half, concluding in January 2013. Amongst others, they looked into the accusation that Google had used illegal methods of maintaining their competitive advantage, including a practice known as “search bias”.

Search bias would involve the manipulation of its search algorithm to unfairly promote its own properties. According to their official press release, the FTC’s inspection found multiple instances of Google taking “aggressive actions to gain advantage over rival search providers”.

However, they also stated that their findings into the “search bias” allegations did not warrant any legal action, claiming that Google’s methods could be “plausibly justified as innovations that improved Google’s product and the experience of its users” and did not stifle competition in any illegal way.

When hearing these results, it is important to remember that the Bureau of Competition’s mission is to “protect competition and not individual competitors”.

Leaked Report

So case closed right? Well, not according to some.

The specific findings of the FTC’s examination were intended to remain private; however sections of their report were mistakenly released to The Wall Street Journal last week, as part of a Freedom of Information request.

The press release issued by the Bureau of Competition summarising their findings made it clear that, whilst Google was certainly no saint, their methods did not require any legal action against them. However, the leaked excerpts reported by the Wall Street Journal, show that some FTC staffers believed otherwise.

Commenting on the issue of “search bias”, the leaked documents stated that “Google’s conduct has resulted – and will result – in real harm to consumers and to innovation in the online search and advertising markets”. The report also claims that “Google has unlawfully maintained its monopoly over general search, search advertising and search syndication”.

Obviously the Bureau took these findings into account before making their decision to not prosecute. These statements represent just a few people who worked on the study, and as such do not show the whole story. However, the fact that some FTC staffers felt this strongly about Google’s market position shows that the possibility of Google one day creating an unfair monopoly may not be too farfetched.

European Commission Enquiry

So where does this leave us?

Whilst the probe into Google’s U.S division may have been officially closed, their European division is a different story. Google’s market share in Europe is even more skewed in their favour than in the U.S, and was the focus of a thorough investigation by the European Commission from Nov 2010 to May 2012.

In an unprecedented move, the EC reopened their case into whether Google’s dominance in the European search market required regulatory action. Their original probe mirrored that of the FTC, as did their findings.

In a press release from their Vice President Joaquin Almunia, the European Commission concluded their inspection with a set of recommendations to remedy their concerns. At the time this appeared to solve any concerns about Google’s practices. However, last year the Commission reopened the case, citing “very negative replies” from complainants regarding the proposed remedies, along with the introduction of “new arguments, new data and new considerations” from those parties.

Conclusion

We began by asking a simple question: does Google hold a monopoly on search? The simple answer is no.

To date, Google’s U.S and European divisions have both been investigated due to allegations of acting unfairly to their competition. Despite both reviews coming up short of finding any illegal activities, the recent leak of documents from the FTC and the reopening of the case by the EC have helped to fan the flames of suspicion and intrigue into Google’s internal practices.

No one knows when the EC’s current analysis will end, or what their findings will be. Even their Vice President is hesitant to commit to a definitive timescale, stating that “we are in an ongoing process so I cannot anticipate the end, I cannot anticipate the conclusions”.

We can only wait and see what their conclusions will be, until then I think we can all agree to give the company that once coined the phrase “Don’t be Evil” the benefit of the doubt. Can’t we?

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