The Mountain View, California company has come under growing scrutiny as regulators and lawmakers probe whether it is abusing its power as the owner of the world’s most popular search engine. About 2 out of every 3 online search requests in the US and an even larger percentage in some parts of Europe are processed by Google. Its search results highlight some of its own specialized services, including online mapping, video and finance.
Schmidt faced some skepticism from senators. Chairman of the Senators Pane, Herb Kohl (D-WI) who said that he would be approaching the issue with an open mind said, “We also need to recognize that as the dominant firm in Internet search, Google has special obligations under antitrust law not to deploy its market power to squelch competition. Hundreds and thousands of businesses depend on Google to grow and prosper.”
Senator Al Franken (D-MN) said he was concerned that Google’s unrivaled growth and success could mean the next Internet entrepreneurs could be squeezed out of competing with the giant.
Republican Mike Lee of Utah wanted an answer as to how Google’s shopping service consistently ranked higher than rivals. “It seems an uncanny statistical coincidence; you’re always third, how do you explain that?” he said. “You’ve cooked it so you’re always third.”
In reply Schmidt said, “Consumers want immediate results for directions and finances when they use the company’s search engine, in addition to suggested links. Google’s shopping comparison results lead to specific consumer items, in contrast to shopping comparison websites. I can assure you we haven’t cooked anything.” Google focuses on getting the right answer in search results he said.
Commenting on the ‘dominance’ factor, Schmidt said that consumers will correct mistakes that companies make. He said that Google could easily be unseated by better technology because competition is only a click-away on the Internet. “It is also possible not to use Google,” he said.
Referring to Microsoft but without naming it, Schmidt said, “Twenty years ago, a large technology firm was setting the world on fire. Its software was on nearly every computer. Its name was synonymous with innovation. But that company lost sight of what mattered. Then Washington stepped in. I was an executive at Sun and later Novell at the time. And in the years since, many of us in Silicon Valley have absorbed the lessons of that era. So I’m here today carrying a long history in the technology business and a very short message about our company: We get it. By that I mean that we get the lessons of our corporate predecessors.”
Schmidt requested members of the Senate Judiciary subcommittee on antitrust for their help to ensure that the FTCs investigation is ‘focused and fair.’
Schmidt’s appearance was followed by a separate panel that was likely to showcase Google’s behavior as unfair, and possibly, illegal. Yelp CEO Jeremy Stoppelman, was one of the counterattacking speakers scheduled. Stoppelman says Google promotes its services by ripping comments from his online review site. Other speakers at the panel included Jeff Katz, who runs shopping search engine Nextag, and Thomas Barnett, who, in 2008, investigated Google’s search dominance, when he led the Justice Department’s anti-trust division. Now, Barnett is part of a group of Google critics called FairSearch, which also includes Microsoft.
Eric Schmidt’s oral testimony before senators
(courtesy: cnet)