DOJ vs. Google: Will it happen? Unlikely - as government would lose

DOJ vs. Google: Will it happen? Unlikely - as government would lose

Summary: There's a potential anti-trust fight looming on the horizon. The target: Google. It's a mega-sized company that many are beginning to become leery of.

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There's a potential anti-trust fight looming on the horizon. The target: Google. It's a mega-sized company that many are beginning to become leery of.  Already many are beginning to wonder just how much bigger Google can get without microscopic scrutiny by the U.S. Department of Justice.  Google's market capitalization is now hovering around 188 Billion U.S. dollars ($589.35/share - as of Dec 10th, 2009), 6thlargest market cap in the U.S. behind (in ranking order) Exxon, Microsoft, Wal-Mart, Apple and JP Morgan.

Google is already on the DOJ's radar screen with its book scanning deal with publishers around the world. The German government is reviewing its options carefully before signing off on the project. DOJ will be satisfied so long as there is no creation of a monopoly of the data or publishing rights being violated.

Google dominates in two primary categories, Internet Search and Advertising revenue.  Google and affiliates rank #1 in all 4 primary internet spaces that Nielsen ratings track.

Top 10 Global Web Parent Companies, Home & Work

October 2009

Rank Parent Unique Audience (000) Active Reach % Time Per Person (HH:MM:SS)
1 Google 353,880 83.75 2:52:53
2 Microsoft 317,671 75.18 3:13:13
3 Yahoo! 237,342 56.17 2:20:27
4 Facebook 199,961 47.33 5:47:04
5 eBay 159,424 37.73 1:51:02
6 Wikimedia Foundation 147,584 34.93 0:15:36
7 AOL LLC 134,635 31.86 2:22:51
8 News Corp. Online 120,681 28.56 1:07:49
9 Amazon 117,255 27.75 0:24:16
10 InterActiveCorp 114,749 27.16 0:12:48
Source: Nielsen NetView

Top 10 U.S. Web Parent Companies, Home & Work

October 2009

Rank Parent Unique Audience (000) Active Reach % Time Per Person (HH:MM:SS)
1 Google 156,635 79.66 2:34:50
2 Microsoft 138,773 70.57 2:06:16
3 Yahoo! 134,745 68.52 3:06:11
4 Facebook 107,482 54.66 6:09:48
5 AOL LLC 91,205 46.38 2:30:32
6 News Corp. Online 79,817 40.59 1:28:46
7 InterActiveCorp 71,310 36.26 0:16:52
8 eBay 66,191 33.66 1:25:29
9 Amazon 63,372 32.23 0:26:11
10 Wikimedia Foundation 62,084 31.57 0:17:07
Source: Nielsen NetView

Top 10 U.S. Online Video Brands, Home & Work

October 2009

Rank Brand Total Streams (000) Unique Viewers (000)
1 YouTube 6,632,964 105,923
2 Hulu 632,662 13,472
3 Facebook 217,765 31,594
4 MSN/WindowsLive/Bing 183,556 17,301
5 Yahoo! 173,482 24,265
6 Fox Interactive Media 160,698 13,142
7 ABC Television 136,348 5,642
8 Turner Sports and Entertainment Digital Network 119,850 5,741
9 ESPN Digital Network 109,799 8,625
10 CBS Entertainment Network 103,741 6,973
Source: Nielsen VideoCensus

Top 10 U.S. Search Providers, Home & Work

October 2009

Rank Provider Searches (000) Share of Searches
- All Search 10,218,842 100.0%
1 Google Search 6,759,395 66.1%
2 Yahoo! Search 1,574,891 15.4%
3 MSN/Windows Live/Bing Search 986,747 9.7%
4 AOL Search 310,178 3.0%
5 Ask.com Search 176,744 1.7%
6 My Web Search Search 101,436 1.0%
7 Comcast Search 51,995 0.5%
8 NexTag Search 35,088 0.3%
9 BizRate Search 30,690 0.3%
10 Yellow Pages Search 30,422 0.3%
Source: Nielsen MegaView Search

Google is on track for approximately 24 Billion dollars in gross revenues, 65+ percent of those being generated by website advertising links. The entire television broadcasting industry doesn't bring that sum of revenue. Little wonder why Microsoft wants to edge into this space as Yahoo's erosion in this space continues.

As Google continues to expand into new opportunities and applications it has not deviated away from its core business and continues innovative marketing solutions available to companies to advertise their products. Google is starting to see some pressure from advertising positions available to marketing departments. Microsoft has placed a bet and bought a significant share of Facebook at an opportune time. With Facebook now surpassing the 350 Million subscriber market, it becomes a valuable property in which to advertise inside of.  Facebook’s revenues, which the company does not disclose but which could reach $500 million this year, are still dwarfed by those of Google. It would appear that they will have a ways to go before catching up - if at all, particularly when compared to Google's advertising Goliath-sized presence.

That creates concern among many: Is Google simply getting to big? What government options are there to have some kind of oversight?

Anti-trust is not a possibility within the advertising industry, at least not right now. DOJ is not about to tell marketers where they have to spend their money and that they can't do business with the #1 search engine company in the world.  It would be impossible to 'break up' the company using this argument.

It can't regulate what Google charges for advertising either since there is no competitor trying to lock in what it costs to generate revenue with them and set prices. The only chance DOJ would have is if Google made exclusive deals for advertising space with specific companies and not allow others into that area.  From their perspective that would be dumb move to even contemplate let alone do, after all why would they want to?

Google will have to be careful with respects to its content group such as the e-Book project and others. Google's foray into publishing such as scholar.google.com will be under the microscope. Since Google does not charge for access to the content, it's likely DOJ would have a difficult time creating a case and it's close to a final settlement with publishers on E-Books. Google's general practice is ensuring that everything it does avoids the appearance and practice of exclusion.

Google's new application development in wireless, collaboration tools and other software applications are open source and thus there's no smoking gun for oversight in those spaces either.  Google's strategy and tactics seem well positioned to weather any government interference and there's little anyone can do about it.

[poll id="28"]

Topics: Banking, Enterprise Software, Google, Government, Government US

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22 comments
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  • RE: DOJ vs. Google: Will it happen? Unlikely - as government would lose

    Yes! If we all band together and urge the DOJ to prosecute Google it will work out well for the consumer. Remember the government is here for us, for the people by the people. We have to unite on this. We should take it one step further and instead of breaking Google up lets have them company disbanded and all of our private data disposed of by erasing it completely. All disks and other mediums that were used should be destroyed. Only then will we be safe from Google. I know their employees will be upset because they will lose their office toys and have to go out and get real jobs, but its a chance we are willing to take.
    Loverock Davidson
    • "for the people by the people."?

      Rule of law?

      Nah, who cares about the law, as long as we break up Google.

      And since everything "MS" is going just SO great, why exactly would you want to? Nothing "Google" is any threat to MS whatsoever, because it is all going to fail, so why would we want to waste taxpayers' money to try to break up Google?

      And you don't use Google for search or
      GMail anyway, right, so privacy is not an issue for you?

      So why exactly do you want to "prosecute" Google?

      Is this what they call a Freudian slip?
      Economister
      • He's just a troll.....

        And you shouldn't feed him. The more you feed him, the more he spouts.
        linux for me
    • Just to be safe

      Lets try this with MS first, since they are the bigger monopoly after all...

      Oh and while we are at it, we could release their code and make it open source! Oh wait, no one would want that. Lets just burn all of their code and save the software community from that underperforming garbage.
      T1Oracle
      • I think it's telling that you wouldn't want Win7 release open-source...

        ...could it be that, if a MS operating system WAS
        released open source, that Linux would be
        ultimately destroyed?
        jedidethfreak
    • Ever read 'Atlas Shrugged'? You sound like James Taggart

      ...or Wesley Mouch.
      Shinsengumi
  • RE: DOJ vs. Google: Will it happen? Unlikely - as government would lose

    While Google is indeed a monopoly, that in and of itself is not what concerns me. My concerns are basically "What is Google doing with all that personal data it's collecting about users?"
    In another blog, it was mentioned how the Droid phone actually pulls all your contacts from all Google affiliated services and syncs them to the phone's contacts, and even though there is a checkbox to not sync with this or that, the default just grabs all of them.
    It just seems a bit much to me, open source or closed.
    As for possible litigation, probably not on anti-monopoly basis, but more likely on violation of privacy should the inevitable breach occur.
    wizard57m-cnet
    • Could DOJ make a case of Monopoly of Data Information?

      I agree Privacy is likely going to an issue that Google will have to spend significant resources upon. It's a topic of an upcoming post I am working on.

      Thanks for writing!
      Doug
      doug.hanchard
      • There are far worse entities out there than Google

        Google IMO is by far the best out of a bad bunch. To
        simply play in the space they do, is a sh*tfight in
        itself. You've got the cream of the pondscum
        dedicated to your anihilation, just crank up Steve
        Balmer on Google and you'll see homicidal tendencies
        shrieking out in pathological mania.

        Google for the most part are open and transparent
        about what they do. For the most part. But it always
        stuns me to see geekery mounting spittle-flecked
        frothy rants about how evil Google is, and by omission
        sanction those darker, infinitely more sinister
        entities who, by their simple furtive existences in
        the darkness of which they hide, get their blessing.

        It's like saying "I hate the person who is 95% open
        about everything they do, but approve of the person
        who tells me 100% lies and is 100% secretive in all
        they do."
        Shinsengumi
    • The more they know about you......

      the more they charge for the ads. We just need appropriate legislation to set the boundaries as to what is legal and what is not. And EVERYTHING must be known/open as to what they collect, how they use it and for how long they keep it. If we can get there, then I am probably OK with it. I am under no illusion however that Google is a saint. In the end they will also want to control the world.
      Economister
      • The illusion is real magic to some

        Some would argue that between Google and Akamai, they already control the majority of non-government data sets.
        doug.hanchard
  • Running XP (nt)

    nt
    Economister
    • But ZDNet runs

      on Linux.
      John Zern
      • Ah, I guess I have to switch then (nt) ;-)

        nt
        Economister
        • He walked into that one ;)

          <br>
          n0neXn0ne
  • Get Google for the same thing as MS...

    Bundling. Google is leveraging their online search advertising market and using that to step into other markets. This is the only reason why Google is able to effectively give away Android and their office suite. It's because of their monopoly on search and search advertising.
    DevStar
    • Not Google in the hot seat

      It's Apple.

      Well not the iBook stuff, but iPhone and iPod

      They own both vertical and horizontal markets.

      How hard is it to get into their space? That is what antitrust is all about now-days.

      Just look around, you can't buy a clock radio that doesn't have an iPod/iPhone interface. Try to clone that interface for your mp3 player and you get sued out of existence by Apple.

      Try to allow iTunes to run anywhere but on Apple equipment and get sued out of existance.

      How does one enter this market. The market being all Apple (it is)

      DOJ will destroy Apple, they have never had this type of marketshare and don't have a clue how to be open.
      LinuxHippie
      • iPhone has plenty of competition

        What are you talking about. iPhone gets a lot of press but there is plenty of competition in that market. Ironically the Android will probably be strong competition.
        dpatjhh
    • Get Google for the same thing as MS

      Google is nothing like MS. MS gives nothing away, you cannot even move your licence to an updated machine and hope to get it accepted. They don't believe there are honest people because they have never met any.

      From Google I get free email with massive free storage. I get the benefit of free search facilities and will get all the new variations as they come on.

      Watch a Google presentation videos and you see real excited people talking about the things they love doing. Watch a Microsoft video and it's all look how clever we are, you are totally dependent on us, Huh!

      This is written on Open source OS and there is no difference from what I get from MS OS except that for everything else I want to run on MS I have to pay, and I have to put up with constant barrage of malware from people who obviously hate MS.

      So, grow up. I am 71 and have paid my way through fifty years of working life, how refreshing that there are people who think that there is a place for giving something away. Besides Google gets a lot of helpful feedback from a lot of grateful people.

      So do not even speak of MS in the same phrase as Google: there's no comparison.
      Stovies
      • You're right, old man, there is no comparison.

        I could give every piece of personal information I
        have - my driver's license number, my SSN, my
        birthdate, height, weight and so forth - to the
        CEO of MS right now, and it would be shredded and
        thrown away. If I type that IN AN EMAIL on gmail
        and send it, it will be stolen within 48 hours,
        because of the data mining that Google does. If
        you want free, that's fine, but don't tell me that
        paying for my privacy isn't worth it.
        jedidethfreak