An Analysis on Google Search Practices Under Investigation

Google has been a great help to everyone especially to students. This search
engine was founded in 1998 by Sergey Brin and Larry Page and is headquartered
in Mountainview, California. Backrub was the original name for the search engine
until Sergey Brin and Larry Page rebranded the company as Google, Inc.

The name of Google is derived from the number googol, which is equal to
the number 1 followed by 100 zeros (1 x 10^100). Apparently, the purpose of
Google is to organize the world's information and make it universally accessible
and useful. Google began as an online search firm, but it now offers more than 50
Internet services and products, from e-mail and online document creation to
software for mobile phones and tablet computers. More than 70 percent of
worldwide online search requests are handled by Google, placing it at the heart of
most Internet users’ experience. Up to now, Google in general including Google
Docs, Google Drive, Gmail, Google sheets and other apps related to it have been
very essential to everyone.

The company has grown to become one of the most innovative companies in
the modern technological age. Since Google was broken out into Google, Inc. and
the parent company Alphabet, Inc., the company has only continued to grow,
touching sectors from its traditional search engine to advertising, science,
entertainment, and autonomous vehicles, etc Google is a large company that
offers various products as well as services, The majority of Google’s revenue comes
from Google’s ads. Google's mission statement is "to organize the world's
information and make it universally accessible and useful" but also has an
unofficial statement/slogan which is "Don't be evil". This motto was replaced in
2015 to "Do the right thing".
1. How has Google been effective in getting and maintaining monopoly power
as a search
engine? Is this sustainable?

Google is more of an example of Oligopoly, not monopoly. Oligopoly is a state of

limited competition, in which a market is shared by a small number of producers
or sellers. In the online search arena, Google is nearly a monopoly with over 94%
of the online search volume and market. Google is Considered as the most
popular search engine used. Bing has taken market share too. This leaves little
room for competitors trying to outsmart and outperform the search engine, which
generates its revenue through ads. The second largest search engine and the main
competitor to Google is Yahoo (AABA), which has a 2.32% market share as of
October 2018. Other companies considered to be Google's main competitors
include technology giant Microsoft's search engine, Bing, as well as Internet
pioneer and media company AOL. Some estimates put Bing at over 30% and
Google as low as 65%. It's not like Google has 99% of the market. Yes, Google is
huge but they don't dominate the industry. There's still other options such as the
examples that were mentioned. It should be noted that in other countries such as
China, Google is banned from conducting business. The number one search
engine of China is Baidu, which controls 76.05% of the market share.

It can also be classified as a hybrid between a perfectly competitive and

monopolistic market. The internet has made many markets closer to perfect
competition because the internet has made it very easy to compare prices, quickly
and efficiently (perfect information). Also, the internet has made barriers to entry
lower. For example, selling a popular good on the internet through a service like
ebay is close to perfect competition. It is easy to compare the prices of goods and
buy from the cheapest. The internet has enabled the price of goods to fall in price
so that firms selling goods on the internet are only making normal profits.
2. Traditionally, monopolies are harmful because they lead to higher prices
for consumers. However, using Google for search is free. Are there any
potential harmful effects of Google’s significant market power?

There are no potential harmful effects of Google's significant market power to

individuals because it is accessible to everyone and they can use it whenever and
wherever. As for the other business, it has potential harmful effects. As it was
mentioned in the case study, other businesses have a hard time laying out their
advertisements or market strategies because Google has been using its
monopolistic power to market its own products in their favor since it can be seen
first while the others appear to be in the latter pages when someone is searching.
Google offers services and earns most of its revenue from advertisements that are
mostly placed in its search engines. However, due to its market power, Google is
capable of giving or charging prices for their services close to the maximum
which limits consumer surplus. More so, its lack of competition in the search
arena leads to a concern about its power to deliver search results.

3. How is Google using its market power to benefit its Google Shopping
platform?

It was said that Google is using its market power to benefit its google shopping
platform by manipulating search results and excluding competitors, that some of
the top search results (both in terms of advertised results and organic search
results) were from google shopping and that results from competing price
comparisons were often placed at the lower page or are moved to the second or
third page. It implies that there is inequality since the other competitors are at the
edge because there is a strong relationship to the location on the page and of how
many consumers click, visit and go through different pages. The results show that
competing price comparison sites receive fewer visitors and reduced revenue. Due
to this manipulation, it is difficult for consumers to assess the quality of at least
some of the search results they receive, resulting in search engines not being able
to provide the highest quality of search results. Google is abusing its market
power and dominance by giving a prominent position and enhanced visibility to
Google Shopping and demoting its rivals, manipulating the search engines to
rivals, which, in turn, reduced consumers' choices for consumers

Google uses search to highlight other Google services, including its business
review and shopping platforms. More worryingly, it has also demoted search
results from competing companies. The UK-based comparison shopping platform
Foundem claims that Google buried its site while promoting Google Shopping,
for instance. Restaurant recommendation site, Yelp, has also complained about
Google’s special search cards, which appear on top of its normal results. “There’s
a lot of great evidence out there showing that Google sort of undertook a strategy
to keep its competitors at bay,” according to Yelp, public policy director Luther
Lowe.

Google has already monopolized ad sales. Google historically auctioned off space
in a way that favored its AdX marketplace. When publishers and ad tech
companies tried to get around that with something called header bidding, Google
pushed back with a centralized system that would still give Google’s own
exchange a potential advantage. When US and EU regulators approved Google’s
acquisition of DoubleClick, it helped Google establish its ad empire in 2008. It
makes money on two fronts: advertisers can buy ad space through a Google
exchange and websites can serve Google ads through the AdSense program. It has
been accused of abusing its power on both sides of the transaction, which is
something Google denies. Since then, they’ve focused their critiques on things
like exclusivity deals. Google could argue that it’s not hurting consumers or
treating other exchanges unfairly. Header bidding can make pages load more
slowly, so discouraging it could help web users.

Not only these things can be manipulated by Google using its market power,
research shows that Google also forces phone makers to bundle its apps even
when their Android operating system is under an open-source license. This is
because phone and tablet makers still need to license popular apps like Google
Maps and the Google Play Store. With that said, soon Google can monopolize the
whole web experience.

4. Is this practice violating Google’s unofficial slogan of “Don’t be evil”?

"Don’t be evil", Googlers generally apply those words to how they serve their
users. But the slogan is much more than that. It is about providing the users with
quality and unbiased access to information, focusing on their needs and giving
them the best products and services that they can. But it is also about doing the
right thing more generally – following the law, acting honourably, and treating
co-workers with courtesy and respect. The Google Code of Conduct is one of the
ways they put “Don’t be evil” into practice. It’s built around the recognition that
everything they do in connection with their work at Google will be, and should
be, measured against the highest possible standards of ethical business conduct.

Sharing this principle, Yes, this practice has violated Google's unofficial logo,
"Don't be evil". Google has not been giving opportunities to other businesses or
companies to lay out their products resulting in them being biased about the
information. Being in a businessworld is like survival of the fittest where one
doesn't need to think about the others aside from himself which is a clear
depiction of what Google is doing. The unofficial slogan only depicts what
Google has been doing for years but on the other way around, since they are
masking themselves through this slogan. Google AMP, for example, has raised
eyebrows among regulators, activists, and web publishers. It makes pages load
super fast on mobile browsers, but it also acts like a special Google-built portal to
the web, granting the company a huge amount of power. To a far lesser extent,
some critics are worried about Google’s moves to block “bad” ads on Chrome,
noting that Google has the means and motive to favor its own ads in the process,
and Chrome holds an estimated two-thirds of the browser market. Such
complaints haven’t garnered nearly as much attention, and they’re likely to
remain in the background of any antitrust probe. But they are a reminder that
Google’s reach is constantly expanding — and so are the complaints against it. It
is a good thing that the "Don't be evil" slogan is unofficial and it was changed
later on to "Do the Right thing" because it is quite inappropriate for a business to
have a vague slogan that can bring confusion to its consumers or target market.