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Policy / DCN perspectives on policy, law, and legislative news surrounding digital content

Google, what big teeth you have  

February 29, 2024 | By Jason Kint, CEO – DCN @jason_kint
The topline: As the media allocates resources for courtroom coverage, remember how high the stakes are: These issues go far beyond the health of the media industry, or the chilling effects of monopolistic power on innovation.  

Google has issues. Lots of them. Unfortunately for our industry, Google’s issues are our issues too.  

Last week, I observed a strange turn of events when an eye-opening HouseFresh blog post titled, “How Google is killing independent sites like ours” quickly evolved into a bizarre critique on the quality of work by and trust for premium publishers. While that may be a subject of debate, one thing we know for sure is that Google’s search experience often puts profits ahead of surfacing quality information—from small sites, independents, or anyone else that isn’t delivering dollars to its bottom line.   

Mind you, this conversation was happening in the very same week in which Google’s outsized role in shaping public perception was on display as their newest product was found to be generating racially diverse Nazis. (Yes, you read that right). Was Google trying to rewrite history? Or just further demonstrating that its product and profit priorities can quickly get dangerously ahead of its historically unique and dominant role in determining how information and value gets distributed to the world.  

Anti-trust me 

Meanwhile, a little-known collective comprised of the United States Department of Justice and nearly every state attorney general was filing its closing briefing for its antitrust trial against – you guessed it – Google. Suffice it to say that this monumental case didn’t get nearly the column inches it deserved despite damning evidence. There’s something almost poignant about an industry undermined by Google for decades lacking the resources, or public interest, to cover a case that rivals other once-in-a-century trials on par with standard oil (likely surpassing AT&T and Microsoft) in its impact on the free market and competition.  

For those new to these details, I would summarize the United States case against Google in three floors of an elevator pitch:  

  1. Google has monopoly power in general search services and the advertising that comes with it.  
  1. Google has systematically captured more than half of this market by paying roughly $30 billion per year for exclusivity on devices (Apple and Samsung) and browsers (e.g. Firefox and Safari). I left out the most popular operating system and browser, Android and Chrome, as Google gets them for free because it owns them. 
  1. The result of this monopoly power is 95% market share on mobile and orders of magnitude advantage in data (aka “signals”) allowing Google to maintain its market dominance through superior data for ranking, local queries, and new queries, along with the all-important ads. And finally substantial advantages in emerging markets like artificial intelligence.  

A case of convoluted logic 

What does Google say about this in its own defense? Well, each of their claims sound weak to those of us who have been around the block a few times in the digital media world. I’ll lay them out here with my own redirect: 

  1. Google spends its first 15 pages arguing it competes in search with Amazon, TikTok, Facebook, Yelp and the list goes on. Have you ever searched Amazon for a local restaurant? Have you ever searched Facebook for a new television? Have you ever searched Yelp for a BBC report? This attempt to throw out the entire definition of general search is a waste of ink. (But, hey: maybe they used Gemini to formulate it.)  
  1. The next chapter from Google is an argument that, even if they accept the market of “general search,” they still don’t have monopoly power in it. To the contrary, a good deal of internal evidence demonstrates Google’s ability to raise prices, lower privacy and weaken consumer experience without missing a beat. An experience utterly degraded, particularly on mobile where it is clearly pay to play and self-preferencing of Google’s own products.  
  1. Finally, Google would like you to believe that all its deals with devices and browsers are not ‘exclusive’ as they merely make Google the default search engine. This may be left to the Court on semantics. But again there are, in evidence, internal decks from Google regarding the power of defaults that explain their significance to maintaining market share along with a damning letter sent to Microsoft claiming it would “deprive consumers of a competitive choice in search” by making Microsoft the default search. That litigation threat was sent by – surprise  – Google. 

Google is not your friend 

I now return to my central point: Google puts the enemy in frenemy. No doubt they are the most significant business partner for nearly every publisher on the planet. They often send the largest monthly revenue checks from their near ubiquitous role in distribution and monetization of the web.  

But as it relates to how they shape its design, the tools we use, the incentives it proffers, and how the welfare gets divided, they are certainly not the friend of media. Nor are they a friend to consumers who seek out quality information and would benefit from an open competitive marketplace.  

Next up, we’ll see the UK Competition and Markets authority flex as it has closely examined Google’s plan for third-party cookie deprecation. The CMA insightfully notes that maybe the solution isn’t further delaying Google’s cookie deprecation – consumers don’t want to be tracked and surveilled – but instead putting limitations on Google’s abuses. A M E N.  

Stateside, Google next faces the US Department of Justice in an adtech lawsuit set to go to trial on September 9th, 2024. The exhibits, depositions and evidence in this case will shine a light on every aspect of how our modern media economy is designed, distributed and dominated by a company that just surpassed $300 billion in revenues. To give that number some relative scale: Google earns the annual revenue of the largest news organizations (be it CNN, The New York Times, FOX News) in the world in just three days. 

Google’s money-making results 

Of course, none of this is to suggest that media endeavors aren’t in the business of making money, if only to support the work of journalists as in the case of non-profit models. Yet again, this week, we learn that Google is reportedly paying “smaller publishers” to use its AI tools. As with other Google News Initiative projects, this one is cloaked in the veneer of helpful benefactor here to support the creation of news. 

Putting the relatively small sums involved aside, publishers are wise to remember that Google is not a friend. There is little doubt that this scheme is intended to benefit Google far more than any of the publishers involved. We may not see it yet, but if the evidence coming to light in the current spate of antitrust trials suggests anything, it is that we can look forward to the revelation of internal documents demonstrating the self (ish) motivation driving this organization.  

Even as we explore the discussion around HouseFresh’s revelations about the questionable quality around the search results for product reviews we can’t forget that the root cause is Google’s profit-first approach. The engine that drives our traffic was really only built to drive revenue for one company. Results that favor commerce favor Google.  

So, as the media allocates resources for courtroom coverage, let’s not forget how high the stakes are here. This goes far beyond the health of the media industry, or the chilling effects of monopolistic power on innovation. Ultimately, it is the marketplace of ideas, the value exchange of information, and the ability to surface essential news and entertainment that suffer in a system so profoundly gamed by one player.