Schmidt: Depends on What the Meaning of “Monopoly” and “Products” Is…

November 7th, 2011 | Bookmark and Share | SUBSCRIBE

Google Chairman Eric Schmidt submitted his answers to more than 100 questions from the Senate Antitrust Subcommittee on Friday, following the panel’s Sept. 21 hearing on the “Power of Google.” At the hearing, Schmidt acknowledged when asked by Subcommittee Chairman Herb Kohl (D-WI) about Google’s monopoly power, “I would agree, Senator, that we’re in that area.”

Not surprisingly, Schmidt back-tracked from that sworn testimony in his written responses, and denied that Google has even a strong position in mobile.

Search Engine Land blogger Matt McGee in a post called Schmidt to task for “betting that he can make a semantic argument to sidestep the accusation” from Senators (and others) that Google favors its own products and services, placing them above other sites through its policy of “universal search.” Schmidt’s written answers repeatedly used a variation of the following theme:

“These universal search results are [Google’s emphasis] our search service—they are not separate ‘Google content’ that can be ‘favored.’”

McGee shreds Schmidt for his response:

“Google most certainly does have separate products and services, despite what Schmidt repeatedly told Congress today. It’s disingenuous, at best, for him to claim that YouTube, Google Maps, Google News and other Google products that appear as universal search results aren’t actually separate products.”

In a separate post, Greg Sterling of Search Engine Land (who acknowledges some even call him a Google “fanboy”) called Schmidt out for offering “technically accurate comments” that stand in stark contrast to “facts on the ground” when it comes to Google’s Android mobile operating system:

“Google does control roughly 97 percent of mobile search. It goes without saying that Google dominates paid-search advertising on mobile devices as well. Indeed, Google dominates mobile advertising in the US (and globally) as a whole.

“Android is the leading smartphone platform — though iOS has more overall share due to the success of the iPad and iPod Touch — with 43 percent of the US market to the iPhone’s 28 percent. On a global basis Android will be the leading smartphone platform by early 2012. And while hardware makers and carriers have some discretion what goes on the handset, the overwhelming majority of Android devices are Google devices.”

Sterling also tears down Schmidt’s repetition of Google’s oft-repeated mantra that “Android is a free, open source platform for mobile devices.” As Sterling writes:

“Google repeatedly talks about Android being an “open platform” that Google doesn’t control. But that’s not entirely correct.

“Google sees Android as its own platform and sees itself and Android as largely inseparable (that’s partly what the Nexus program reflects). And so when a third party threatens to get in-between Android and a core function on the device Google has a reaction — as in the case of Skyhook Wireless striking deals with Motorola and Samsung to replace Google’s location positioning technology.”

The kicker? Sterling, a widely quoted analyst who in his own words has “written extensively that it makes no sense for the US to start regulating… Google’s algorithm,” says that “arguably, however, Android is a much different case than PC search.”

Why?

“Mobile internet access is projected to overtake the fixed internet by 2015. Android will likely become the dominant mobile computing platform next year with all that implies for Google, mobile search and ad revenues. Accordingly, it’s not unreasonable to look very closely at Google’s relationship to Android and potentially consider rules or a process to ensure the reality of the Android ecosystem lives up to Google’s rhetoric about openness.”

When analysts that are usually in Google’s corner like Greg Sterling say that Google’s overwhelming dominance of mobile search deserves close watch by the government it is time to listen.