DOJ May One Day Try to Break Up Google

    January 29, 2006

In chapter eight John Battelle’s incredible book, The Search, he astutely predicted that Google would increasingly fall under the watchful eye of the US government.

As we saw earlier this month, John was right. The US government requested aggregate search data not only from Google, but from all of the major search engines. Only Google didn’t comply.

Years from now we will remark that this was the beginning of the end of Google as we know it. The reason is one day – maybe sooner than we think – the government will try to break up Google. This may accelerate depending on the outcome of the 2008 election.

Whether DOJ would succeed here is entirely an open question. However, if this does indeed happen, it will certainly slow down the search giant and the Web economy overall, much as DOJ did for Microsoft and the PC economy.

Over the past two years we’ve all watched as Google’s image has transitioned from a once post-dot-com era darling into a Big Brother that many industries – from retailing to media to advertisers and more – fear. This trepidation isn’t rooted really in Google’s web search prowess, but more in its increasingly far-reaching tentacles. This fear only rises as Google moves into new industries beyond its core. Notably these include online and offline advertising, book and video distribution, commerce, and possibly music too if the rumors are correct.

As Google launches new services and begins to disrupt other industries (almost always with the consumer in mind), it will succeed wildly in some arenas and fail in others. However, where it succeeds Google will become the most powerful intermediary on the planet. Every business – including airlines, advertisers, media companies, retailers and more – will rise or fall depending on how they are positioned on Google’s services. As this power (which to some degree already is present) gets larger, Google will be tempted to give its paying customers all kinds of breaks. The question is will they be able to resist this urge as competitors pour on the heat.

Let’s look at a conceivable example of how a bigger Google might lead to unfair competition. Let’s say you’re a book publisher. Google’s Google+sales&l=&sort=” class=”bluelink”>growing sales force convinces you to purchase Adwords that lead searchers to your book samples on Google Books. Carefully placed links on Google Books take browsers to Froogle where consumers can buy the book. This doesn’t sound unfair so far. However, imagine Google sweetens the deal and gives you special incentives if you pull out of MSN Shopping. What might this include? Perhaps they will offer radio airtime or print ad space. Or, maybe they will happily feature your latest CNN PR hit right on the Google Video home page.

Think this won’t happen? Think again. With power comes corruption. Revisit DOJ vs. Microsoft. In this landmark case Microsoft was accused of cutting off partners who did business with competitors. This was back in the day when Windows was our core entryway to the Web. Now that Google is becoming the Web dial tone, it may tie all of its ever-expanding tentacles together in ways that cut off competitors. And if that happens then you can bet the Feds will step in.

Unfortunately, my fear is that this will happen one day. Why? Perhaps Google will need to substantiate its burgeoning market cap with fresh earnings and it will cut corners. Or maybe less scrupulous employees will join the company as it grows. Or maybe Google’s ego will go to its head. Who knows? However, what we all saw these last few weeks is that the Feds are watching this space. One slip-up will land Google in a courtroom not unlike Judge Penfield Jackson’s. And if or when this happens, then it could have a chilling effect on all of the industries that thrive on the search economy – including PR and marketing.

Steve Rubel is a PR strategist with nearly 16 years of public relations, marketing, journalism and communications experience. He currently serves as a Senior Vice President with Edelman, the largest independent global PR firm.

He authors the Micro Persuasion weblog, which tracks how blogs and participatory journalism are changing the public relations practice.