Is this the way to contain Google? Really?

I'm going to pass on whether Google is a dangerous monopoly that deserves to get hauled into court. The Justice Department will issue a final yea or nay on that question du jour by early October. In the meantime, the list of rivals leaning on the trustbusters for succor gets longer by the day.

The latest is the World Association of Newspapers (aptly named WAN), which represents 77 newspaper associations and 18,000 papers around the globe. WAN wants competition authorities in the U.S. and in Europe to block the Google-Yahoo deal. The position taken by the Paris-based organization offers up a familiar argument. Still, it reveals much the mindset of the people who believe Google is on the verge of becoming dangerously ubiquitous. (The Newspaper Association of America, a group that represents more than 2,000 newspapers in the U.S. and Canada and is a member of WAN, said Monday that its board has not taken a position on the Google-Yahoo ad deal.)

In this case, WAN's particular interest is in making sure its members receive competitive returns for advertising placed on their sites, while getting competitive prices when they buy paid search advertising.

"The proposed deal will fatally weaken Yahoo as a competitor for these deals. Advertisers will increasingly migrate to Google since they will see diminishing price advantages to advertising through Yahoo. Yahoo will then have fewer of its own ads to serve and therefore less ability to offer a better deal than Google. This problem will grow over time because Google - in a clear display of its true intent - has refused to allow Yahoo to show Google ads on the websites of new publishing partners it acquires after the deal is finalized. In other words, Google has imposed a condition that impedes one of Yahoo's last remaining opportunities to compete with Google. What this means for newspapers is that Yahoo's bids for their ad business will almost certainly be lower than they are today."

"What this means for newspapers is that Yahoo's bids for their ad business will almost certainly be lower than they are today. And because Google will almost certainly acquire valuable insider knowledge about Yahoo's ad business, it will be in a much stronger position to predict Yahoo's "best" bid to newspapers for these deals, which will allow Google to bid just slightly over that amount."

But is that really so? Could be, but we're still in the he-said, she-said stage of investigation. The deal hasn't even closed and opinions are flying all over the blogosphere. I don't dismiss WAN's trepidation, but newspapers and advertising concerns--as well as any other business segment that feels threatened by Google's encroachment--surely know this is only a sideshow. Government intervention won't do much, if anything, to slow down the accelerating fragmentation of media.

Yet earlier this summer, WAN President Gavin O'Reilly did not seem overly concerned about the challenge to his industry's old business model when he told a panel at the World Newspaper Congress in Gothenburg, Sweden, the following:

"The fact is that newspapers are winning well in a world of heightened digital fragmentation. In properly assessing the performance of newspapers, one needs to calmly analyse the underlying audience trends for our industry, the quantum of our readership and the quality demographic that we deliver, coupled with the incremental and growing audience that we garner from online. The conclusion is that our industry is extremely well positioned at weathering the storm that is media fragmentation, guaranteeing as we do sizeable, reliable and relatively stable audiences."

As Loren Feldman's sock puppet send-up of Shel Israel is wont to say: Fascinating!

[benjaminstraight]

People hate success.

[The_Decider]

Simplistic and wrong.

If a company can become extremely successful without breaching ethics or the law, they would not be hated.

[honorable1]

No. People hate Google and the Elitists that run it.

[AppleSuxLeo]

Well put...funny how MSFT was evil for being big , but so many still like GOOG. GOOG is the most evil and could care less about our privacy.

[davedaver1]

"People" don't hate Google, they use the heck out of it. The newspapers, who no longer have the ability to contain readers with their biased ways, hate Google because it gives people choice.

[nicmart]

In short, envy.

[Josh7234]

lol You are confused Sir, because someone has success in the world doesnt mean that there evil. google was started in the garage and has become one of the lrgest companys. Most of the things google does it for its consumers such as spending million sof dollars on satellite images just so its consumers who spend time on google maps can have a better view of the world. Google will get nothing out of this offer. Secondly google has provided competition sch as when google offered gmail whith its massive storage and yahoo had hardly any store had to bump up its webmails to remain competitive thanks once again too google. Thirdly if you have recalled googles hundred of million dollars there spending so third world countrys can have a decent internet connection in return for just viewing a few advertisements. Those are just a few of the things that google has done not to mention they have never charged a penny for its services unless you want extra space etc. So i say congrats google and keep up the good work.

[Penguinisto]

ROTFL... the same MSFT that turned down the two Google CEO's when Google was a nobody and trying to market their original idea?

I'm betting that Gates and Ballmer both are kicking themselves over that one...

[jackdaniels08]

It is inevitable. The newspaper industry will be extinct, NOT the news media in the digital sense, but actual newsprint newspaper. Times are changing. Google follows the law and doesn't do things against it. Lot's of thought went into this partnership. This is a healthy deal for everyone. The internet still has much area to grow so contrary to what WAN thinks, there is plenty of room for competition.

[jhart4067]

The situation has been driven by natural market forces. Google's quality is higher on all counts than Yahoo's, and this is the natural consequence. Let the market be.

[BNAMack]

Well, I don't hate Google. In fact, it's my home page and I use Gmail - it's just so danged quick and easy.

BUT - the argument made by the WAN members is reasonable enough to at least investigate. While I don't think that Google is neccesarily an evil entity, I do believe that old addage that absolute power will corrupt, absolutely.

I'd like to think that someone will treat this with rational diligence and see if the claims are true. But the evidence of our increasingly vitriolic and confrontational society doesn't really leave much hope for that.

[kizm]

Google doesn't enslave people with early termination fees. It doesn't upgrade for a new operating system to collect easy money. Their only crime is success through a simple slogan: You can do well in business without fining customers, trapping them with early termination fees...
They did not force the market to favor them into monopoly like microsoft did. Leave google alone.

[Rede84]

Google is spyware. Anybody who supports it must be new to the internet. There's been a long historic battle against spyware which Google's fans are completely unaware of.

[microace]

You must be a freetard. The only people I know who are against google are l-users who are jealous of the technology gains Google has made and put on the net for free.

[dragonwithaheadache]

Please do your research. Google like all search engines introduce tracking cookies for its own benefit. This is also done by every ISP (Internet Service Provider) in exsistance. Your statement is illogical compared to the facts of the internet. Also there are these programs for blocking spyware you should probably try out.

[eltoro2827]

i agree....google is the devil

[mhmcgrath]

As a kid growing up in a small city (Wilmington, DE pop. ~100,000) there were three papers (at different times) every working day. Frequently, there would be an "Extra" - making four editions in a day. People have always wanted news all the time, information all the time - and in a way papers tried to meet that need. Now, it's minute-by-minute information needs and newspapers will never be able to match Google. BUT (and it's a BIG BUT still) Google will NEVER be able to match the newspaper for some aspects of information and ease-of-use. Lounging on the deck or at the beach or in the lobby of the Waldorf - with the Sunday Times - tossing it aside, picking it up, clipping a piece to fold into a SLOOOW letter to an old friend mentioned in the piece - because that information "artifact" will have a certain physical durability - well, you get the idea. And the papers are adapting to this new role (often dualized on the Web). And papers are adapting their content to match this more durable role. It remains to be seen whether all will do it well. But like the book (versus the e-book) there is a long term role for the newspaper - and Google, etal. too. And most of us want to see BOTH survive and prosper.

[sanityvoice2]

Below is some wording that Google recently removed from its User Agreement for this new software:

"a clause that gave Google a "perpetual, irrevocable, worldwide, royalty-free, and non-exclusive licence to reproduce, adapt, modify, translate, publish, publicly, perform, publicly display and distribute" any information they typed into a website."

Now! Imagine the mentality it took to include that phrase to begin with. Do you feel that because they removed the clause under intense pressure that their mentality has changed? No? Neither do I.

So, if you want that mentality to continue to gain power over your and my and the rest of the world's communications, then go ahead and be naive and support these obscenely power hungry demogogues. Normally, I too would see the word "demogogue" as a term most often used by some wigged-out fanatic. But, then, I read that Google clause again and realize that not all conspiracy theories are as flaky as I wish they were. How obvious do they have to be in order to suck us in?

[dragonwithaheadache]

Hate to inform you of this but every bit of the clause except the ability to modify is granted any time some one post something to a webserver. This is called intent to display. The modify part of this clause is so Google, Yahoo, Microsoft, etc. can modify to the format they use on their webservers. i.e. Apache and Microsoft's Ineternet Information Services although similiar have different formats means formats have to be modified accordingly. Not to mention all the different browsers also display content differently.

[revenant83]

AFAIK, that EULA originated in Google Video, and was required, basically, to prevent someone from uploading a video and then suing Google for sharing it. They were making it clear that you were giving up your rights, and protecting themselves from frivolous -- but potentially VERY expensive -- lawsuits. It's not really Google's fault; it's draconian copyright laws like the DMCA that Google is concerned about, and rightly so.

[HighwayHome]

I don't know if the hardcopy newspaper industry will ever become totally extinct. There will always be those who will still prefer to sit at the kitchen table every morning and blacken their finger tips with the fresh ink from the morning paper. And besides, reading hardcopy is a bit more easier on the eye than reading pixels.

Another reason to preserve the newspaper print industry is it provides a hardcopy backup which can be archived. Who knows, depending on what type of turn civilization takes, this record keeping may one day become essential if mass amounts of digital data mysteriously vanish. Always nice to have a master hardcopy sitting on the bench in case the starter goes down and gets knocked out. Ask the New England Patriots.

With regards to the anti-trust issue, an economy is prone to smoother functioning when all of its eggs are not placed in one basket. See the current Lehman Bros, AIG & FM fiascos if you are skeptical about such an assertion.

There is no such thing as natural market forces. There is absolutely nothing natural about peoples' behavior, which is exactly what fuels the market. However, there is such a thing as one company controlling an exclusive product and overcharging for it. What would be the harm of having four or five other quality advertising options? Of course, Google is against this because an increase in supply would drive their price down.

Google also wants to keep the status quo because it can reject any advertiser/publisher whom it deems it to be in competition with them. By having complete control of who advertises on this exclusive monopolistic network, they control the exposure of these rogue evildoers.

Of course, there are also privacy concerns about cross-referencing search data and advertising data. Since Google has yet to take users' privacy concerns very seriously (see YouTube Viacom fiasco), this is yet another avenue for the firm to flex its muscle.

For far too long, the Capital Beltway crowd has been listening to the lobbyists and ignoring the needs of a struggling market. Without stringent guidelines being implemented to reel in the cowboys, one can expect more Wall Street tanking.

There is a lot here for the boys in DC to take a look at. Hopefully, they won't be blinded by the light when viewing a firm which claims not to be an evildoer.

[ZetaZeta_]

Google is the best at what they do, advertising, and Yahoo recognizes that. Rather than spend money on their own advertisement development / search engine technologies, they decide to go with the best, Google, and just put ads on their site. Both companies make money, the market share for the other companies doing advertisement remains the same, people getting their ads put up aren't necessarily mad, I mean, it's the same service. In a way, everyone using the same search engine for advertising provides more accurate results. Everyone's happy, right? Every aspect of this deal is good.

However, governments do not like capitalism.

[ivorycruncher]

You know, the sad thing here is that Google was created on, grew on, and is sustained by one primary source of funds: advertising. Maybe I'm just old-fashioned (and I'm only 25), but I'd be willing to bet that if companies started putting even half of their advertising budgets into product research and development, we'd actually have things like innovation to speak of again in the USA. Everybody seems to love pouring money into advertising, and all they end up doing is advertising poor quality services and products. They may be selling nothing but cheap junk, but they're gonna make sure you know about it. I'm guessing that if somebody really comes out with an exceptional product or service, it will practically advertise itself due to word of mouth, press, etc.

Now I'm not against advertising in general. It's a necessary part of life, obviously. However, the fact that companies can exist solely based on advertising revenue, especially giants like Google, tells me that was have a huge problem here. Businesses are pouring more money than ever before into advertising, and consumers are just plain sick and tired of it. For cryin' out loud, they're trying to be allowed to deliver location-based text message ads to cell phones. This is a serious invasion of privacy, not to mention respect for your potential customers. I think businesses need to stop trying to hard to sell you cheap crap and start selling worthwhile goods, which as I said will should almost sell themselves if they're actually good.

Google is a good company in a lot of ways. Whether they are a trust is not up to me to decide, especially when I don't know all the facts. All I can say is let justice be served, don't let greed control you, and please give your customers the respect they deserve. If those three things were to happen more often, I think we'd be much better off than we are now.

[ZetaZeta_]

In case you have been living under a rock, Google has poured billions of dollars in dozens of ventures, many of which were supposed to make money, but didn't. Also, please consider that hundreds if not thousands of things exist for, if not soley for, the selling of advertisement. Television programs have commercials to make a lot of their revenue. Social networking sites make tons of dough in adverts. YouTube sells advertisement was well.

Think of it this way: Google makes 99% of it's revenue on advertisement... *just* advertisement, HOWEVER that money goes straight "into product research and development," or money spent in acquiring innvoative technologies, and that's why you have things like Google's entire freaking suite of web apps, GMail, Chrome, YouTube, Reader, Docs, Earth etc. etc. etc.

Google sells ads to make money to make good products that will sell more ads.
>>"The fact that companies can exist solely based on advertising revenue, especially giants like Google, tells me that was have a huge problem here."
It might sound bad, but it's not. Pay services make a good product so that they will sell that product and make money. Google is a different kind of service in that you "pay" by looking at ads. That's the only difference.

[CmdrRickHunter]

I mostly agree with Zeta, but I do feel your pain. I'm awfully offended when I think I've found a supplier for something I want when that spot has actually been ousted by an advertiser which cut/pasted my keyword into their add, and actually doesn't even sell anything in the same market. Don't get me started about the fat fingering!

The problem with advertising is the Tragedy of the Commons. If everyone advertised quietly, everything would work. But if one person advertises louder than everyone else, they gain more. So everyone ramps up their noise. Soon, you can't just invent a good product - no one will find you amidst the cacophony of advertising!

Check out EPIC 2014. Its a flash clip made a long time ago about the future as Google takes over. Its pretty frightening

[atish505]

Google is not a monopolist. There is competition out there. the question is why do people still feel comfortable in spending their Ad dollar on Google and not through Microsoft or other alternatives.

The answer is: simplicity and confidence.

The Microsoft's and AT & Ts of the world want to tie people into contracts and pay for upgrades and downgrades, Google does not force anyone.

It is not Spyware, you read, agree and install it on your own terms, and remove it when you need it.

[eltoro2827]

google is spyware you nimrod....who does it better....they do.