NYT: “Google Casts a Big Shadow on Smaller Web Sites”

November 5th, 2012 | Bookmark and Share | SUBSCRIBE

In a lengthy Nov. 3 piece, The New York Times reporting explains in detail how Google exerts enormous control over the fate of smaller Websites, often controlling their destiny with little recourse for companies harmed by inexplicable shifts in its search and business practices.

“The relationship between Google and Web sites, publishers and advertisers often seems lopsided, if not unfair,” report Steve Lohr and Claire Cain Miller, adding that staff at the U.S. Federal Trade Commission has recommended bringing an antitrust suit against Google.

The story contained three strong examples of how small companies are suffering at the hands of Google, emblematic of the far broader harms that the FTC is likely weighing in deciding whether to bring a case against the company. As the Times reporters write, “Being big is no crime, but if a powerful company uses market muscle to stifle competition, that is an antitrust violation.”

Here are the stories of harm documented by the Times

  • Price comparison shopping site Nextag has seen a steady decline in traffic from Google Search results. Currently, 30 percent of Nextag’s traffic from Google comes from search results and 70 percent from paid ads. Two years ago, 60 percent of the traffic from Google came from search results and 40 percent from paid ads. Facing this decline, Nextag has doubled its spending on Google ads in the last five months. “We had to do it,” Jeffrey Katz, chief executive of Wize Commerce, owner of Nextag to the Times. “We’re living in Google’s world.”
  • Vote-USA.org, an online resource for voters, saw its traffic from Google plummet because the site included information on national candidates on state pages. Vote-USA.org made changes to those pages as Google’s algorithm penalizes such duplicate content. While traffic has rebounded, Ron Kahlow, head of the site, has seen Google promote its own voting and ballot product. “I’m sure they’re aware of the amount of money that’s being spent in politics and I’m sure they’d like to get their fingers in the pie,” Kahlow told the Times.
  • Google News mysteriously dropped CaryCitizen, a local news site in Cary, N.C., and Berkeleyside, a local news site in Berkeley, Calif., from news results last year for periods of time. The news sites were added back to search results, with little explanation offered. “It’s a totally opaque corporation,” said Lance Knobel, head of Berkeleyside.

The crux of the potential antitrust case that may be brought against Google, the Times reports, is whether the company is using its search engine to favor its own products, such as Google Shopping and Google+ Local.

As the Times’ own reporting documents, the case is clear that Google is using its dominant search engine to steer users its own products and away from potential rivals, whether they are large or small. Law enforcement officials at the FTC and other agencies who are investigating Google must step in and force Google to stop abusing its dominance since the company has refused to change its practices. Strong, enforceable remedies are needed, and they must eliminate the conflict of interest at the heart of Google’s business that is behind its abuse of its monopoly power to steer users to its own products and away from others.