WASHINGTON D.C. – Today Senator Mike Lee (R-Utah) took on Google and it’s CEO Eric Schmidt at a Senate Judiciary Committee on Capitol Hill.
Lee is the ranking member on the Senate Judiciary Committee’s Antitrust Subcommittee, and called for the oversight hearing on Google to review the company’s fair competition practices.
“As a strong supporter of free markets, competition, and innovation, I was disappointed by the testimony of Google chairman Eric Schmidt,” Lee said at the conclusion of the hearing. “I had hoped to hear the company acknowledge the responsibilities that accompany its preeminent position in the Internet search market and address concerns many have raised about Google’s possible anticompetitive activities. Unfortunately, I fear that some of the testimony in today’s hearing may only encourage those who are calling for legal enforcement or government regulation. I am hopeful that we can avoid those outcomes, and encourage Google to take appropriate voluntary action to resolve these concerns.”
In his opening statement, Lee cited a former Regan administration antitrust chief who said Google has the power to be a “monopoly gatekeeper to the Internet.” According to a press release, Lee said Google has used “substantial advertising revenues” to branch out and purchase over 100 different companies, including YouTube, Gmail, Chrome and Google Plus.
Google is now under investigation by antitrust authorities for “indeceptive and anticompetitive ways,” the press release said. Lee argues that Google originally meant to have users search their site, and leave Google as quickly as possible. Now, Google has competing services, which keep users in Google instead of sending them to other websites, Lee claims. Lee also accuses Google of taking information from Yelp and TripAdvisor, using that on it’s own site, and then demoting competing sites in search rankings.
Lee than stated that Google “sought to maintain its dominance in search by imposing exclusivity restrictions in dealings with advertising partners, perhaps in an effort to block competing search tools. This includes a broad network of exclusive search syndication deals with websites like AOL and eBay, exclusive arrangements for Google’s search box to appear on browsers like Mozilla Firefox and Safari, and agreements that Google be the exclusive default search provider on the iPhone and many Android models.”
Lee concluded that the antitrust committee is really concerned about consumer welfare and that growing complaints deserve serious attention.
“Such bias would deny user traffic and revenue to competing sites, depriving those sites of resources needed to develop more innovative content and offer better services to customers. When competing websites lose traffic, they are forced to increase paid search advertising on Google, ultimately leading to increased prices for consumers,” Lee said.
What remains to be seen, however, is whether Google has actually done anything illegal.
“Whether or not Google formally qualifies as a monopoly under our antitrust laws, one thing is clear: given its significant ability to steer e-commerce and the flow of online information, Google is in a position to help determine who will succeed and who will fail on the Internet,” Lee said.
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