Friday, May 25, 2012

4 Areas of Concerns Over Google Business Practices

European Competition Commissioner had recently warned Google about issues on manipulation of search results.

The European Commission said Google may have abused its dominance in Internet search by manipulating its search results for its own gain, promoting its own businesses at the expense of competitors. They had given Google just a “a matter of weeks” to propose changes and remedies to its method of answering user queries, as outlined in the large anti-trust inquiry into Google’s business, or possibly face an antitrust lawsuit.

An antitrust lawsuit is a court case against businesses that are monopolizing or doing anti-competitive behavior (monopoly) and unfair business practices.

European Competition Commission’s antitrust investigation into the internet search giant, Google, had begun in November 2010. The investigation was triggered by the complaints of abuse of Google’s dominant market position from rivals, including Microsoft.

As stated in a letter to Google’s executive chairman, Eric Schmidt, the EU’s anti-trust chief, Joaquin Almunia, had identified for the first time “four concerns where Google's business practices may be considered as abuses of dominance.”

First Area of Concern – Google's Manipulation of its Search Results

It states that, “In its general search results, Google displays links to its own vertical search services differently than it does for links to competitors,” he said. Vertical search services are specialized search engines which are designed to focus on specific topics, such as for example restaurants, news or products.

“We are concerned that this may result in preferential treatment compared to those of competing services, which may be hurt as a consequence.”

Second Area of Concern – The Way Google Observed Copyright Laws

As stated, “Our second concern relates to the way Google copies content from competing vertical search services and uses it in its own offerings.” Google is accused of “may be copying original material from the websites of its competitors such as user reviews and using that material on its own sites without their prior authorisation.” And, “In this way they are appropriating the benefits of the investments of competitors. We are worried that this could reduce competitors' incentives to invest in the creation of original content for the benefit of internet users. This practice may impact for instance travel sites or sites providing restaurant guides.”

Third Area of Concern - Over Restrictions Written into Google’s Advertising Contracts.

It appears that Google’s de facto exclusivity in its advertising agreements can “potentially impact advertising services purchased for example by online stores, online magazines or broadcasters.”

Fourth Area of Concern - Google’s Restrictions on the Portability of Online Search Advertising Campaigns

Finally, the fourth concern is about the restrictions on the portability of their online search advertising campaigns across different web platforms such as from its platform AdWords to the platforms of competitors.

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