Is Google a Monopoly? A Historical Perspective

Google(graphic Is Google a Monopoly? Did you mean: A Historical Perspective Google's search market share topped 66% in September. While there seems to be room for competition, monopolies are not all about market share. The government filed anti-trust suits against US Steel when they had 67% of the market. Could it happen to Google? Google's tentacles tap into sizable market shares of many different products and services. Search Maps YouTube Android Gmail Chrome Search for 'email' and Gmail is ranked first despite being the third largest service. The largest, Yahoo! Mail, is second, and Google's rival, Microsoft, is fourth. Google search is supposed to provide the best and unbiased results. The problem is that it has to make decisions about Google displays a Google Map in 1 in 13 search results. MapQuest or Yahoo! Maps appear in none. ranking its own products versus competitors'. YouTube and Google Video enjoy higher rankings for queries with the term 'video' than competitors. So what happens? We don't know yet. Several smaller competitors have filed anti-competitive complaints against Google. Ironically some of those complaints are supported by Microsoft. Texas Attorney General, Gregg Abbot is investigating anti-trust allegations against Google. Whether or not the government considers Google a monopoly is a nuanced affair. To look into the future, it's often best to look at the past for insights. What about Microsoft? Windows has long enjoyed being the operating system of over 90% of personal computers. From this platform it was able to bundle and push Internet Explorer into the 75% range in 1998. Browser competitors like Netscape and Opera had a problem with this. The US Department of Justice along with 30 states filed an anti-trust suit against Microsoft in May of 1998. 199 The plaintiffs won and Microsoft was ordered to split upinto two units, one for the OS and the other for everything else. KAM 1998 The ruling was overturned in appeal and the DOJ stopped trying to break up Microsoft. In 2001, a settlement was reached and Microsoft agreed to share its API's with third parties. Nine states did not agree to the settlement as they thought it didn't go far enough. 27 So what happened? Safari and Opera Chrome Microsoft continued to bundle their OS and browser, pushing IE's market share to 95% in 2003. Innovative competitors like Firefox have whittled that down to 49% but Windows still enjoys a market share north of 90%. While Microsoft's share price peaked in 1999, it's still a dominant company with a $200+ billion market cap. Firefox Question: Should Google be able to promote their products at the top spot to dominate broad categories like maps and videos? What about AT&T? For most of its 125 years in business, AT&T has been a natural monopoly, sanctioned and regulated by the government under the banner of universal service. The rise of new technologies like microwave communications and competitors like MCI eroded the need or desire for a natural monopoly. The party was over in 1974 when the DOJ filed an anti-trust suit against AT&T. Eight years later a settlement was reached. MCI. AT&T was split into 7 independent Regional Holding Companies. In return, the government would allow AT&T to have unregulated access to the computer and software market. UNIX- AT&T Computer Systems was a failure despite creating the first commercial version of Unix. NYNEX O Bell Atlantic LUSWEST @ BELLSOUTH SÉC PACIFIC TELESIS Ameritech. Acquired Acquired Acquired Qwest GTE Merged Acquired AT&T verizon Acquired at&t So what happened? AT&T lost 70% of its value after the divesiture but after various mergers and acquisitions, the company now known as AT&T is the largest non-oil and non-banking company in the world. Question: Could Google be seen as a public utility? What About US Steel? US Steel was created in 1901 when J.P. Morgan, Andrew Carnagie, Charles M. Schwab and others combined several steel companies into one, creating the first billion dollar company. USS In its first year, it produced 67% of the steel in the US. After journalist whipped up hysteria over the dangers of a monopoly, the government brought an anti-trust suit against US Steel. They were cleared by the Supreme Court in 1920 for not engaging in "unreasonable" restraint of trade. By that time their market share had fallen to 50% and would continue to Such as Bethlehem Steel, run by former US Steel CEO, Charles M. Schwab. ВЕТH ЕНЕМ STEEL decline due to innovative and fast moving competitors. So what happened? The expected monopoly never materialized. After 100 years of operation US Steel produces slightly more steel than it did in its first full year,tt 1902. Production peaked in 1953 and since then, foreign and domestic competition, labor disputes, and government intervention have whittled their market share down to 10%. Question: Is Google attracting too much attention for its size? Are there more innovating competitors run by ex-Googlers? What about Standard Oil? Founded in 187o, John D. Rockefeller's Standard Oil soon became one of the largest multinational corporations in the world. STANDARD In 1904 Standard Oil controlled 91% of production and 85% of sales in the US. Four years later, the government filed an anti-trust suit alleging a long list of unfair, controlling and abusive practices and tactics. The suit claimed Standard Oil would raise prices for it monopolized customers and lower them to hurt competitors. Standard Oil was split into 34 separate companies. The Justice Department won the case. Standard Oil appealed but the decision was upheld by the Supreme Court. Standard Oil of New Jersey Standard Oil of Louisiana Standard Oil Standard Oil of New York Standard Oil of California Standard Oil of lowa Standard Oil of Kentucky Standard Oil of Indiana Standard Oil of Minnesota Standard Oil of llinois Standard Oil of Kansas Standard Oil of Ohio Continental Oil Company The Ohio Oil Company Standard Oil of Missouri South Penn Oil Co. -Esso -Exxon ExxonMobile Brazil -Sacony-Sacony-Vacuum - Mobile -Chevron -ChevronTexaco -Chevron Amoco BP ConocoPhillips -Marathon Oil -Conoco dissolved Pennzoil Shell So what happened? While the Standard Oil Company was atomized, Rockefeller, who owned a quarter of Standard's stock now owned a quarter of all the new companies, whose value rose fivefold. Rockefeller emerged from the break up as the world's richest man. At the time, 1 of every 65 dollars in the US economy belonged to John D. Rockefeller. Question: Does Google's use its dominate market share in monopolistic ways? brought to you by SCOSCO.ORG 'BYJESS.NET and Acquired