Category: Menacing Monopoly

Finally!

The European Commission is said to be planning to charge Google with using its dominant position in online search to favor the company’s own online services over others, in what would be one of the biggest antitrust cases here since antitrust regulators went after Microsoft.

Europe’s competition chief, Margrethe Vestager, is expected to make an announcement that Google has abused its dominant position on Wednesday in Brussels, according to two people who spoke on Tuesday on the condition of anonymity.

The U.S. government didn’t have the cajones to effectively stand up to Google, but it looks like Europe is ready to confront the Monster of Mountain View with antitrust charges. This is very good news, if true.

The Federal Trade Commission should have listened to its staff:

The Federal Trade Commission on Thursday faced renewed questions about its handling of its antitrust investigation into Google, after documents revealed that an internal report had recommended stronger action.

The 2012 report, from the agency’s bureau of competition, said that the agency should sue the Internet search company for anticompetitive practices, according to several people who saw the report but would speak about it only under the condition of anonymity. At least one other staff report, they said, recommended not to pursue a lawsuit. In early 2013, the agency unanimously voted not to bring charges after an investigation.

Google’s critics and competitors on Thursday jumped on the news, first reported by The Wall Street Journal, arguing that the F.T.C. had failed to take appropriate action. They called on Europe, which is now looking into the company’s practices, to pursue tough regulations.

European regulators must not fail to make the same mistakes that the Federal Trade Commission did. They must aggressively discipline Google for any violations of privacy and antitrust laws that they find through a comprehensive, meaningful investigation.

The Monster of Mountain View just had another meal:

Google has inked a distribution deal with the biggest wireless carriers in the U.S. to get the Google Wallet payments app pre-installed on their phones. At the same time, Google is buying technology from Softcard, the mobile payments app backed by the same carriers.

The deal will see Verizon Wireless, T-Mobile and AT&T pre-install Google Wallet on their Android phones in the U.S. later this year. Google Wallet allows shoppers to tap their phones to pay at checkout in some brick-and-mortar stores in much the same way Apple Pay does. The move also involves Google buying some intellectual property from Softcard, formerly known as ISIS. It doesn’t appear that any Softcard employees are joining Google as part of the deal.

In a blog post, Softcard said its users can use their mobile payments app for now. But I can’t imagine the wireless carriers behind the Softcard joint venture would agree to this deal if they planned to continue to invest in their own app. Sounds like game over for Softcard, a very expensive multi-year initiative that was essentially a flop for the wireless companies involved.

Softcard never really had a future, considering Apple has planned on entering the mobile payment space for sometime. iOS is Apple’s platform, and Apple wants to both control it and monetize it. It wasn’t about to let America’s three largest mobile carriers develop the mobile wallet that would be prevalent among iOS users.

Google feels the same way about controlling Android, of course. The carriers have evidently decided that since Apple doesn’t need or want their technology, they’ll at least recoup some money by selling it to Google. Google will probably shut it down within a few weeks, and that will be the end of Softcard.

POSTSCRIPT: Softcard will be dead by the end of March:

 

Goodbye, Softcard.

Google has gotten too big for its own good and the good of everyone else, European leaders say:

The European Parliament has voted in favour of breaking Google up, as a solution to complaints that it favours its own services in search results.

Politicians have no power to enforce a break-up, but the landmark vote sends a clear message to European regulators to get tough on the net giant.

US politicians and trade bodies have voiced their dismay at the vote.

The ultimate decision will rest with EU competition commissioner Margrethe Vestager.

She has inherited the anti-competitive case lodged by Google’s rivals in 2010.

Google has around 90% market share for search in Europe and rivals asked the commission to investigate four areas:

• The manner in which Google displays its own vertical search services compared with other, competing products
• How Google copies content from other websites – such as restaurant reviews – to include within its own services
• The exclusivity Google has to sell advertising around the search terms people use
• Restrictions on advertisers from moving their online ad campaigns to rival search engines

Emphasis is LGB’s.

This is a smart and commendable move on the part of the European Parliament. Someone has to stand up to the increasingly powerful Monster of Mountain View. The government of the country where Google is based is unwilling to do anything more than slap Google on the wrist every now and then (usually when privacy violations become too egregious to ignore), so it’s good that Europe is stepping up.

There is ample precedent for large companies being broken up. The United States government forced the breakup of AT&T, Standard Oil, and other large firms during the twentieth century. Microsoft came close to being broken up at the end of the 1990s and is used to responding to antitrust challenges.

Google is increasingly everyone’s competitor. Microsoft has known this for a long time; Apple and Amazon have only more recently begun to appreciate how grand Google’s ambitions and aims are. Google wants to be the dominant provider of search, email, social networking, DNS resolution, maps, domain names, web browsing software, mobile phone software, cloud storage, and a zillion other things.

Google has gotten too big and the world would benefit from its breakup.

This should have happened in 2011, when Mozilla and Google last extended their deal. Unfortunately, for some lame reason, Mozilla’s leadership at the time simply didn’t seem to appreciate that Google was intent on siphoning away their users and dominating browser market share with Chrome just as it has dominated search. But better late than never:

Mozilla is breaking up with Google and switching to Yahoo as the default search provider for its popular Firefox web browser.

Mozilla’s partnership with Google had been rocky for years, so its end was not entirely unexpected. Google is America’s favorite search provider, with about two-thirds of the market, according to comScore, but it also created and actively promotes its own web browser, Chrome.

Mozilla, meanwhile, has sought to create its own mobile phone software, competing with Google’s Android, and has tried to distinguish itself from rivals by committing to customer privacy technologies that are opposed by Google, Facebook, Yahoo and just about every other major website that sells advertising

As a result of this deal, the world’s three most widely used web browsers will all have different default search engines.

Google naturally has its own search engine set as the default in Chrome, although it is changeable (Bing and Yahoo are the only other built-in choices). Firefox will now have Yahoo as the default, and is adding DuckDuckGo as one of the built-in options, like Apple. Internet Explorer naturally uses Bing as its default search engine, and like Chrome, the default can be changed.

Years ago, such favoritism by Microsoft would have drawn far more scorn and scrutiny, but at least when it comes to search, Microsoft is the underdog and Google the giant. Internet Explorer still has plenty of browser market share, but it’s down from what it used to be. The latest version of Internet Explorer is only available for Windows 7 and Windows 8, not XP or Vista. Amusingly, up to date versions of Firefox and Chrome can be installed on all four.

Apple, meanwhile, has been increasingly moving away from Google. Apple is using Bing to power Siri and search results for Spotlight. Google remains the default in Safari for the time being, likely due to a contractual arrangement. When Apple inevitably ditches Google as the default for search in Safari, that will just leave Opera as the only other browser maker to use Google by default. Opera would be wise to do what Mozilla and Apple are doing and choose a different default search provider.

Robert O’Callahan makes a persuasive cast for ditching Chrome:

if you want an Internet — which means, in many ways, a world — that isn’t controlled by Google, you must stop using Chrome now and encourage others to do the same. If you don’t, and Google wins, then in years to come you’ll wish you had a choice and have only yourself to blame for spurning it now.

Amen! We’re glad Robert has seen the light and become a Google skeptic. Welcome back to the light side, friend.

Typical behavior from the Monster of Mountain View. TechDirt reports:

We’ve been disappointed in the past to see Google descend into the land of trademark bullies, and had hoped that the company had learned its lesson. Unfortunately, it appears that the company still will dip into trademark bullying when it really should know better. The latest came in response to some pranksters setting up a (quite amusing) parody site called Google-Nest.org, playing on the fact that Google recently purchased Nest, the makers of internet connected thermostats and smoke detectors. The site was clearly mocking Google’s expansion into… well… everything, with fake product announcements for things like Google Trust, Google Hug and Google Bee (your personal drone). The whole thing was clearly parody, and while it was clearly making a statement about how integrated Google has become into many people’s lives, you would have hoped that Google’s trademark lawyers would have a sense of humor and let it go.

They did not.

Instead, Google’s lawyers sent the people behind the parody site a threatening letter, indicating they would take legal action if the site was not taken down. The creators of the site turned to the Electronic Frontier Foundation and JBB in Germany for help. On May 16th, the EFF sent Google a letter pointedly reminding the company that U.S. copyright and trademark law protects parody and satire, and explaining why the domain name for the parody site would not be transferred to Google:

Dear Google Trademark Team,

The Electronic Frontier Foundation represents the Peng! Collective in connection with your complaints regarding the above-listed website.

We reviewed with dismay your email of May 8, 2012, asking that Peng! revise the site and transfer the domain name to Google. Instead of a cease and desist, we would have expected you to take a page from Linden Labs and issue a “proceed and permit” letter instead.

The site is a pure political commentary. Indeed, its launch has long since been recognized as such by a variety of news organizations. U.S. authorities consistently support the basic notion that trademark law does not reach, much less prohibit, this kind of speech regarding a matter of substantial public concern.1 Simply put, The Lanham Act regulates only economic, not ideological or political, competition… Competition in the marketplace of ideas is precisely what the First Amendment is designed to protect.Koch Ind. v. John Does 1-25, 2011 WL 1775765, D.Utah (May 9, 2011).

First, use of the Google name and logo on the site is fully protected by the nominative fair use doctrine. See, e. g. Century 21 Real Estate Corp. v. Lendingtree, 425 F.3d 211, 218-221 (3d Cir. 2005); New Kids on the Block v. New America Pub, 971 F.2d 302, 308 (9th Cir.1992). Indeed, courts have noted that nominative fair uses are particularly likely to be found in parodies. Mattel v. Walking Mountain Prods., 353 F.3d 792, 80 n.l4 (9th Cir. 2003).

Second, given the content of the site, and the ample publicity the spoof has generated, all of which recognized as satirical and parodical commentary, it is difficult to imagine that any Internet user would be confused.

Third, the site is sheltered by the First Amendment, see LL. Bean, Inc. v. Drake Publishers, Inc., 811 F.2d 26, 29 (1st Cir. 1987); Cliff Notes v. Bantam Doubleday Dell Publishing Group, 886 F.2d 490, 495 (2d Cir. 1989); CPC Int Inc. v. Skippy Inc., 214 F.3d 456 (4th Cir. 2000); Mattel, Inc. v. MCA Records, 296 F.3d 894, 906 (9th Cir. 2002). Again, there is nothing on the site that would lead consumers to purchase goods or services based on a mistaken affiliation.

Finally, my client’s action is entirely noncommercial and, therefore, statutorily exempt from the Lanham Act. See 15 U.S.C. 1127, 1125; Bosley Med. Inst. v. Kremer, 403 F.3d 672, 677 (9th Cir. 2005); aubman v. WebFeat.s’, 319 F.3d 770, 774 (6th Cir. 2003); CPC Int’! V. Skippy, 214 F.3d 456, 461 (4th Cir. 2000).

Nonetheless, Peng! feels confident that it has accomplished its initial purpose of raising awareness about and commenting on Google privacy policies. Accordingly, it has revised the site to discuss the parody, and Google’s response to it. As a practical matter, we believe that revision has largely met your demands. However, we also believe it is important for Internet users to have a full document of the hoax and Google’s response, and that such documentation be housed in the most logical place, at the existing domain name. Therefore, my client is not willing to transfer the domain name.

I sincerely hope this ends this matter. If you have further concerns, please direct them to my attention.

Best regards,

Corynne McSherry
IP Director

The site is archived by the Internet Archive, so it is thankfully still available to view. For now.