Google vs. Microsoft: Tech war

Discussion in 'Wall St. News' started by bearice, Apr 16, 2011.

  1. Google vs. Microsoft: Tech war

    Google is under siege in Washington like never before — and it says an “anti-Google industrial complex” is to blame.

    In an interview with POLITICO, a Google spokesman argued that a cabal of antitrust lawyers, lobbyists and public relations firms is conspiring against the Internet search giant. The mastermind? Google says it’s Microsoft.

    Maybe it’s irony, or maybe it’s payback.

    In the 1990s, Microsoft was the tech industry wunderkind that got too big for its britches — and Google CEO Eric Schmidt, then an executive at Sun Microsystems and later Novell, helped knock the software titan down a peg by providing evidence in the government’s antitrust case against it.

    The constraints imposed on Microsoft in that case helped clear the way for Google’s rise to rule the Web. Now — as Google spreads its tentacles into everything from mobile phones to digital online libraries to green energy — some of Microsoft’s allies are saying it’s time for the search giant to get its comeuppance.

    “There is so much conduct that should be investigated,” said Pamela Jones Harbour, a former Federal Trade Commission member, who opposed Google’s merger with online advertising firm DoubleClick in 2007.

    Harbour, now an attorney specializing in competition issues, consults for Microsoft on competition and policy issues, and she says Google now has a monopoly.

    But there are also increasing calls from some Silicon Valley competitors and Washington-based public interest groups for the Justice Department to launch a sweeping antitrust probe of Google. The European Union and the state of Texas have reviews under way.

    Google says its rivals are fueling the attacks. Specifically, the company points to Microsoft, which has a stable of consultants and lawyers in Washington banging the antitrust drums.

    “We try to create lots of new technologies for consumers, and the companies and industries that we disrupt sometimes try to seek recourse in Washington,” said Adam Kovacevich, a Google spokesman, who recently was detailed to deal solely with antitrust issues. “In particular, Microsoft and our large competitors have invested a lot in D.C. to stoke scrutiny of us. But our goal is to make sure that we can continue creating cool new things for consumers.”

    Microsoft declined to trade barbs publicly but argues that Google is lashing out amid a growing number of complaints to regulators and lawmakers about the company’s business practices. The company points out competitors usually are the source of antitrust complaints.

    One of Microsoft’s antitrust attorneys, Charles “Rick” Rule, of the international law firm Cadwalader, Wickersham & Taft, wrote in The Wall Street Journal in a September op-ed piece that Google is a monopolist and should face an investigation.

    “What goes around, comes around,” he wrote.

    Rule, a DOJ antitrust chief in the Reagan administration, was one of the attorneys representing Microsoft at its own antitrust trial. He now also represents two other companies, myTriggers and TradeComet, in private antitrust lawsuits against Google.

    In addition to lobbyists and public relations firms, Google says Microsoft and AT&T are behind some of its most vocal critics, such as Scott Cleland, a Washington analyst who runs websites called Googleopoly.net and Googlemonitor.com.

    In congressional testimony, Cleland acknowledged consulting for Microsoft since 2009 and said he had ties to telecom, cable and wireless broadband firms. But he seems to believe Google has a habit of picking on the little guy: “It’s scary that the monopoly information access point of the world is going after voices of dissent,” he told POLITICO.

    It’s not just paid critics hammering away at Google. A growing number of online businesses say they’re worried Google is using its dominance in Internet search and search advertising to move into new arenas — such as online travel or local search — and pummel its rivals.

    “They’re biasing their search results to favor their own products,” Stephen Kaufer, CEO of TripAdvisor, an online travel website, told POLITICO. Kaufer said a feature called Google Places now appears first in Google search results when users search for travel destinations, causing his site to drop in search rankings.

    TripAdvisor is part of the FairSearch.org coalition, formed in Washington last fall to fight Google’s $700 million purchase of ITA Software. Members include Expedia, Hotwire, Kayak, Travelocity — and Microsoft. The point man for the group and Expedia’s counsel is Tom Barnett, former DOJ antitrust chief in the George W. Bush White House. His firm, Covington & Burling, also represented Microsoft during its antitrust trial.

    Google said its rivals are tattling while the company is just trying to innovate.

    “We built Google for users, not websites, and the nature of ranking search results is that some websites will always be unhappy with where they rank,” Kovacevich said.

    That argument doesn’t fly with Harbour. Any “cool innovations” resulting from the merger might come “as a result of abusive conduct and at the expense of competitors.”

    Google argues that Microsoft’s Bing search engine has a feature similar to Google Places that puts Bing content at the top of search result pages. Microsoft pumps $2 billion a year into Bing — and Bing now powers Yahoo’s back end — but has failed to make a dent in Google’s 66 percent search-market share, according to research firm comScore.


    Google’s rise as king of the Web was accompanied by a growing policy agenda that forced it to step on the toes of some entrenched Washington players. Its advocacy for net neutrality helped push the FCC to adopt Open Internet rules but put it at odds with telecom powerhouses. Some of those companies have turned the table on Google, arguing for “search neutrality.”

    “It’s so successful. It’s so effective. It’s so big. And as it gets into more verticals, more and more companies are looking over their shoulder nervously at this behemoth,” said Rebecca Arbogast, managing director of research firm Stifel Nicolaus.

    But the behemoth isn’t going down without a fight.

    Google has recently brought in executives to discuss how neutrality can’t be achieved in search because the company’s algorithm is based on subjective factors to ensure users get accurate results. Armed with an 89-page slide presentation titled “Search Integrity,” Google’s Matt Cutts last month made the rounds on the Hill and to regulators.

    In Silicon Valley, where many look upon government interference in business through a libertarian-leaning lens, a few startups such as Yelp have publicly complained that their companies — which buy search ads from Google — have appeared lower in search results compared with Google’s own competing products. Other Web-based businesses such as CitySearch and WebMD also have criticized Google’s practices. They all declined to be interviewed by POLITICO.

    “Smaller companies that do business with Google ... are all very vulnerable because they get a lot of traffic from Google,” said Gary Reback, a Silicon Valley attorney who badgered federal authorities into bringing the Microsoft antitrust case and now has his sights set on Google. “They are very fearful of retaliation.”

    Reback won’t disclose his clients, other than to say he is working for “a number of companies.” Google believes one of those companies is Microsoft.

    Google officials say they’ve learned from Microsoft’s mistakes. That was one reason the company opened an office in Washington in 2005, only a year after it went public. The company’s spending on lobbying climbed to $5.1 million last year, edging closer to Microsoft’s $7 million.

    The company has hired its share of consultants, lobbyists and attorneys, too. “What’s lined up against Google are well-heeled competitors trying to shackle the free market,” said David Balto, a former FTC policy director and now senior fellow at the Center for American Progress.

    Balto has testified on behalf of Google in the past.

    In fact, three years ago, Google brought in some hired guns to try to persuade regulators to prevent the proposed merger between Microsoft and Yahoo — a partnership devised to counter Google’s dominance in search. Google lined its bench at the time with Jamie Gorelick, a Clinton-era deputy attorney general, and public relations firm Chlopak Leonard Schechter — in addition to the Washington veterans the company already had on retainer, such as the King & Spalding law firm and the Podesta Group.

    Yahoo rejected Microsoft’s bid but settled for a search and advertising partnership last year that the DOJ approved, saying it would increase competition to Google.

    This is the first part of a POLITICO Pro series on Google in Washington. To read more of the series -- and to get ahead-of-the-curve reporting on energy, technology and health care -- please visit www.politicopro.com.
     
  2. Posters:

    I'd feel bad for Google, but they've crawled into bed (colluded) with the Obama Administration one too many times. By coordinating with Obama--and the left--to control information flow, Google surrendered the mantle of impartiality.

    Google was one of Obamas largest supporters in 08. They not only donated as a company but donated personally to his campaign.Hang on Microsoft, if Googles anything like Obamas coddled Unions, they'll have lots of tax payer dollars to fight you and society with. Ultimately it will be the Lawyers that win...typical.
     
  3. Dont you ever do anything else besides posting bullshit on et? seek help.
     
  4. You must have purchased Google shares. Now people who have google shares will need help.

    I will be purchasing microsoft "Bing" shares.
     
  5. Two of the world's biggest companies Microsoft and Google are fighting each other.

    When a hippopotamus dies, 100 or 200 crocodiles feed on the dead hippo.

    When a bull elephant dies, hundreds and thousands of animals feed on the dead elephant.

    I hope everybody understood what I mean to say.
     
  6. Breaking Google & Microsft into smaller entities will create millions of new jobs in the economy
     
  7. I think Google has 20,000 employees (not sure) and google is one of the biggest companies in the world.
     
  8. The new thread title "Google vs. Microsoft: Tech war" is same as the original title "USA - Russia War started".
     
  9. Oh the sweet smell of revenge! Microsoft was probably very angry at Eric Schmidt for being a snitch!

    I prefer Google to Bing to be honest. But I also don't like how Google keeps tarck of everything. IMO Google needs to stop growing lest it reach a point where it becomes a global power. Oh wait...