Google faces a moment of truth in the coming weeks over a lengthy US probe into potential abuse of its Internet search dominance, amid regulatory woes on both sides of the Atlantic.
The Federal Trade Commission is widely reported to be nearing a decision on whether to pursue Google for monopoly abuses, at the same time European regulators are conducting a similar review.
At least one member of Congress is warning the FTC to be wary of meddling in Google’s business, but some of Google’s rivals are pressing hard for action.
Critics point out that Google controls some 70 percent of the Internet search market and the advertising that goes along with it and may exert even more power in the mobile sector by controlling the Android operating system used on two-thirds of smartphones.
“These are practices which drive up prices and drive down competition,” said Ben Hammer, whose Fairsearch.org coalition includes the travel websites Expedia and Kayak, mobile phone maker Nokia, and Microsoft, a company which faced its own antitrust case over a decade ago.
Google is accused of “scraping” content from other services like travel and restaurant reviews while keeping consumers on its own sites.
It is also under fire for allegedly promoting its own services — including travel, restaurant reviews and YouTube videos — in its search results.
Another of Google critics’ concerns is the way the company limits how advertisers can manage ads with Google and competitors.
“They remind me a lot of Microsoft in the 90s: massively arrogant, having the feeling they have the power to do anything they want,” said Rob Enderle, a Silicon Valley consultant and analyst. ”Companies that get this way eventually run afoul of the government, sometimes catastrophically. They haven’t been competing fairly for some time.”
Google’s problems are not limited to Washington.
Google has also made proposals to regulators in the EU anti-trust probe into whether the Internet search giant had abused its dominant market position, which officials called “a good basis for further talks.”
But in the US, a case from trade regulators would not be clear cut, say some analysts.
Danny Sullivan, who edits the blog Search Engine Land, said it is problematic for regulators to determine whether a search is “fair.” Even if Google searches favor its own sites, “it’s probably not wrong,” said Sullivan, who argued that the case offers a test of freedom of expression.
Sullivan said those seeking to impose “neutral” search results suggest a scary type of regulation: “It’s like saying the New York Times algorithm should be decided by a government committee. Nobody should question that the government should stay out.”
Last year, Google chairman Eric Schmidt told a congressional panel he rejected charges that the company “cooks” search results to favor its own services, even though some lawmakers disputed the claim.
Glenn Manishin, a Washington antitrust lawyer who represented plaintiffs in the Microsoft antitrust case, said a case against Google would be “uncharted” legal territory, and markedly different from the Microsoft case.
“There’s a fundamental difference between an operating system which has the ability and technology to exclude rivals from the platform, and Internet search or search advertising,” he said.
“There’s nothing locking users into using Google either for search or for advertising… it’s not a single highway to get to where you’re going. Windows was, because it was on 95 percent of PCs. Other companies can and do enter the search market.”
Manishin said antitrust law is aimed at protecting consumers, not rival companies. He said the FTC could pursue Google administratively for “unfair competition,” but added legal standards are vague and the agency has never won such a case.
“If you ask for the government to intervene, you don’t know what’s going to happen,” the attorney said. “The government may decide it will be the arbiter of what’s fair and unfair, and it may be a slippery slope toward government regulation.”
US Congressman Jared Polis, in an open letter to the FTC, urged the agency not to act to “compromise the important service provided by Google.”
“Competition is only a click away, and there are no barriers to competition,” the lawmaker said. ”The FTC should tread carefully when reviewing Google, Facebook or any other tech company, given the dynamism of our tech industry.”
Many legal experts say Google would lose in the marketplace if it failed to act in consumers’ interest, but Mark Patterson, a Fordham University law professor specializing in antitrust, said consumers lack the information to know how Google operates.
“What you really need to look at is how much can they manipulate their search results without consumers knowing,” he said. ”Yes it’s easy for consumers to switch. It’s not easy for consumers to know why they should switch.”
Should search engines like Google have to pay publishers like newspapers for linking to their content? France says yes, Google says no and it’s prepared to go nuclear on the issue.
Google executives met with French government officials on Friday to discuss the company’s threat to drop French media sites from its search results if France goes through with a proposal to make search engines pay commissions for links to news content.
The owners of many French newspapers are in favor of the tax, believing their revenue and copyrights are compromised when Google’s search results display their content. French Culture Minister Aurelie Filippetti seems to agree. She told a parliamentary commission it is “a tool that it seems important to me to develop.”
Google says that such a law would “threaten its very existence,” according to a letter it sent to several French officials. The letter was first publicized by French news service Agence France-Presse, which obtained a copy. Google later posted the full letter on its European blog.
Google (GOOG, Fortune 500) says in the letter that it “cannot accept” such a move, and consequently would be forced to stop referencing French sites.
Google’s representatives met in Paris with Fleur Pellerin, the French Minister for small business, innovation and numeric economy, according to Arnaud Guillois, a spokesman for the French embassy in Washington.
France isn’t the only country in Europe to propose such legislation. Germany is considering a similar law.
Such rules “would be very damaging to the internet,” Google said in its blog post.
Given two competitive sites that are identical in practically every other way, the faster site will be more successful. Site speed is associated, in the mind of the end user, with a site’s reliability, credibility, security, and stability. Because faster web sites provide a better user experience, they typically result in higher conversion rates, average order values, and site stickiness. In fact, according to the web site performance measurement firm Gomez, the average online visitor expects pages to load in two seconds or less — and after three short seconds, as many as 40 percent of visitors will abandon your site. So what can you do to accelerate your site performance?
Web Performance Optimization (WPO) is a relatively new discipline focused on improving the web user experience by making pages load faster. This is done through a variety of front-end optimization techniques that make it easier for web browsers, as well as networks that deliver traffic, to load and render web page content. These techniques include front-end optimization techniques such as minification, concatenation, subdomain sharding, and content compression (collectively referred to as Front End Optimization or “FEO”); cache optimization such as expires-time extension, and network optimization utilizing real-time network measurements to determine fastest paths from any end-user location, for example.
Perhaps the most common mistake that companies make when working to optimize site performance is to assume that there is a “one size fits all” solution. This is rarely is the case, since designing and delivering different performance optimizations to different browsers, operating systems, geographies, devices, and visitor types is very difficult to do manually. Unless, of course, you have an automated WPO solution that allows you to target and test different performance optimization techniques in real-time in an otherwise non-intrusive way. The non-intrusive part is important because it relieves your site developers and IT staff from having to spend a lot of time making code changes.
This kind of WPO solution allows site operators to test and target the delivery of performance optimization techniques to different site visitors based on their geography, device, browser, or relationship with your online business. What’s more, these solutions help you understand the impact of performance on the user experience — as well as marketing and financial goals — of the entire blend of optimizations that are being tested. In other words, measuring not only speed but also specific KPIs (key performance indicators) that are important to your online business, including bounce rate, conversion rate, average order value, abandonment, and compound metrics that look at multiple behaviors both within and across multiple visits.
Now, unless you have IT staff with cycles to burn, or are able to dedicate resources to focus on ongoing performance optimization, you may want to consider outsourcing your WPO efforts. Given the relative complexity of performance optimization and a rapidly changing landscape, Web Performance Optimization is in many ways similar to Search Engine Optimization (SEO). Both require specific domain knowledge, and both require ongoing management and refinement to realize and maintain value.
By outsourcing your performance optimization efforts, you can simultaneously stay current on emerging WPO approaches including domain SPDY, HTML5 localStorage, TCP optimizations, mobile-specific optimizations, and more. Outsourcing can create an advantage in that it allows your existing developers to stay focused on the task at hand — building great sites.
Eric J. Hansen is the founder and CEO of web optimization firm SiteSpect, and the chief architect of the firm’s non-intrusive technology for multivariate testing, behavioral targeting and web performance optimization.