Microsoft, German publishers hit Google with anti-trust suits
Hey Hillary, can you help us out in Europe as well?
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Google has been hit with a barrage of anti-trust complaints in Germany, with two publisher groups, a mapping firm and a Microsoft-owned ad firm launching an enveloping movement on the ad broker and sometime search firm.
The quartet of actions follow hard on the heels of a Paris-backed pummeling for Google in France, and a little local difficulty in China.
Germany's Federation of Newspaper Publishers and Association of German Magazine Publishers have both taken umbrage at the search engine's serving up of slivers of news articles without payment.
Meanwhile, Euro-Cities, a German mapping firm, has apparently complained that Google's policy of letting just anyone embed Google maps in their sites is anti-competitive and is killing its own business.
Lastly, Ciao, a price comparison and review site owned by Microsoft, is trying to wiggle out of a contract that ties it into showing Google adsense ads. Microsoft claims the deal violates competition rules, a claim which presumably has nothing to do with Microsoft wanting to build its own advertising business.
At first glance, the Microsoft suit smacks of a contractual spat rather than a genuine competition issue. However, the publishers and the mapping firm's complaints are hinting at broader issues.
In the case of mapping, Google has so much cash lying around that it can give stuff away for free - meaning other firms are deprived of their business models. It's the same complaint firms are making in the US about the firm's bid to run the white space database.
And the German publishers' complaints are arguably more significant than the Belgian publishers' complaint that was settled back in 2007.
For a start, they include some heavyweight pan-European players like Axel Springer. Plus since 2007, publishers worldwide have become much more vocal about what they see as Google's free riding on their content, with the likes of Rupert Murdoch happy to call Google a parasite for its co-opting of his content.
It's fair to say that the German intellectual elite may be a little more in tune with the publisher's complaints than they may have been a few years ago.
Last week, German justice minister Sabine Leutheusser-Schnarrenberger said the firm was becoming a monopoly. Chancellor Angela Merkel has slated the firm's book scanning project.
Germany's position is broadly in line with France, whose culture minister has slammed Google books, while president Sarkozy has floated the idea of a special Google tax to offset the pain caused to French auteurs and artists by Google-aided piracy.
A Google spokesperson told Bloomberg it was "convinced" that it complied with all the relevant German and European laws.
It would be an incredibly cynical person who would suggest that Google's sudden qualms about working in China and subsequent seeking of Hillary Clinton's protection had anything to do with a suddenly more hostile regulatory environment in Europe. ®
COMMENTS
Real World
"In the case of mapping, Google has so much cash lying around that it can give stuff away for free - meaning other firms are deprived of their business models."
The real world analogue of this is called dumping and it's illegal in Europe and indeed the US. Giving stuff away free, or at least selling it at way below cost, is usually used as a way of harming the competition and that's why it's illegal. There's no reason the internet should be any different. Google can afford to do it because of their massive advertising revenue and using income from one business sector to harm rivals in another has got to be seen as bad for the market in that sector.
Restricting choice in any market sector has got to be bad for capitlism, which would tend to demonstrate that Google are not only anti-competitive but un-American as well.
And what is the view of blighty?
????
Exactly.
Mandy is too busy having his belly tickled while rolling round on lots of large cash filled brown envelopes.
It certainly does show another step of France and Gemany speaking the same language and leaving us in the cold. How many times has this been the case of late? Europe moves on and we are left paying the cheque.
re: AC @ 16:53 - Real World
If the real world analogy is illegal product dumping, then the same case can be made for EVERY website on the internet that does not charge you to access it.
The Reg doesn't charge you to access it's articles, and host a paper rag does. Since it and it obviously costs something to produce and host the content , it follows that The Reg is "Dumping" their product, and is engaging in illegal anti-competitive behavior - at least according to the definition that you are applying to Google.
Any other website that provides content for free (most of the internet) would run afoul of the same problems.
The reality is that giving stuff away for free or below cost in the brick and mortar world is called "Loss Leading". It is a well-established, consumer-friendly way for a company to gain prospective clients or increase market share.
If Loss Leading didn't exist and wasn't accepted, your "free" cell phone would have cost you $600+ at signup. Instead, by selling the phones at a loss or giving them away the cell carriers were able to increase market penetration with the intention of making up the loss on the back end of the contract.
Google wasn't the first to provide online Mapping, and they are not the best ones in the marketplace, but they provide the service as a loss leader to get you into trying their other services. If you run a mapping service and don't like it, well, you can either throw a tantrum or produce a product that gives the consumer a better value. We can see what the competition did here.
I'm not trying to support Google here - I am trying to support a free Internet, where people can provide or share their content for free if they so desire. If you want to post your vacation pictures online and let others use them, then you shouldn't be sued by stock photography companies because your free picture of an empty beach competes with their ability to sell someone a picture of the same beach.
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