Media Wonk

Google: It's payback time - February 4, 2008

Still fuming over Microsoft's efforts to persuade regulators to block Google's bid for DoubleClick, Google wasted no time trying to blow up Microsoft's $44 billion bid for Yahoo! Over the weekend, Google's chief legal officer David Drummund posted an item on the Google corporate blog posing what he called "troubling questions" raised by the proposed deal and waving the bloody shirt of past anticompetitive behavior.

"Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC?" Drummond asked. "Could the acquisition of Yahoo! allow Microsoft -- despite its legacy of serious legal and regulatory offenses -- to extend unfair practices from browsers and operating systems to the Internet?"

Fair enough, Media Wonk supposes, in a tit-for-tat sort of way. But a bit weak on logic. If anyone is in a position to do on the Internet what Microsoft did in the PC business its Google, not Microsoft. At least as far as media companies are concerned, search is the operating system of the Internet, and Google has nearly as commanding a position in search as Microsoft has in the PC OS business. Microsoft only wishes it had the same kind of "influence over the Internet that it did with the PC," the kind that Google has.

Search has become the main way people navigate online, more important than any browser, OS or desktop application. If you're in the business of publishing content on the Internet, you basically work for Google. Search drives traffic, and traffic equals revenue. If people can't easily find your content using the world's most popular search engine then you might as well not bother publishing it.

And Google hasn't been particularly shy about leveraging its dominant position in search to muscle its way into adjacent businesses. Just ask book publishers about Google's ambitions.

The next great frontier in search is video. Whoever comes up with a video search technology sophisticated enough to permit the sort of contextual advertising Google has perfected for text ads will automatically become a major player in the online video business, regardless of where the content comes from. So far, neither Microsoft/Yahoo nor Google have made it work. But if anyone has the inside track it's Google, based on its unshakeable association in consumers' minds with search.

That's the truly scary prospect for media publishers. And it's not even clear what a regulator could do about it even if it had a mind to. Order Google to stop being so could at finding things? Now there's a troubling question.

LEAVE A COMMENT