Will 2008 Be Google’s End Of Innocence?

by: Michael Arrington posted on: June 16, 2008 | about stocks: GOOG    
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2008 may be the year that Google’s innocence ends, as media and governments start to cast a less forgiving eye at the behavior of the company that controls 60% of the search market and perhaps as much as half of all online advertising revenue.

In 2007 the Federal Trade Commission opened an antitrust investigation into Google’s $3.1 billion acquisition of DoubleClick. The deal was eventually approved, although the EU took a lot longer to give their stamp of approval (The EU in general isn’t a fan of Google).

This year, though, things might not go so well. Politicians are lining up to question Google’s recent search marketing deal with Yahoo. The deal was clearly structured to try to slide past regulators, but it isn’t clear that this time Google will get a pass.

Other questions are being raised as well - such as why Firefox continues to default search to Google on clean installs, instead of offering users a choice right up front. Microsoft is forced to offer users a choice when they install Internet Explorer. Given the longstanding financial ties between Google and Firefox, perhaps the same choice should be presented there as well.

There’s no getting past the fact that Google has out-competed everyone in the search game, and is justly collecting the economic rewards of that effort. But society loves to tear down their heroes just as quickly as they supported them as underdogs.

This may be the year that things change for the ten-year-old Google. Their days of innocence may be over - perhaps Yahoo, or Firefox, are the apples that they should not have bitten into.

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Michael Arrington

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This article has 4 comments:

  •  
    max Zeledon
    Jun 16 08:36 AM
    My Website
    Excellent take on Google and its future prospects. Google will continue to be huge, but regulators and competitors will make future growth much more difficult.
  •  
    Tom B
    Jun 16 10:49 AM
    "DoubleClick. The deal was eventually approved,"


    The Deal was APPROVED, man.

    MSFT deliberately tried to kill Netscape when they forced installation of IE; that's why the DoJ (almost) nailed them. GOOG has not built up a mountain of anti-Google hatred, like MSFT has. GOOG has not held technological back by decades, like MSFT has. GOOG brings many privacy concerns, but, truly, they also provide USEFUL services-- unlike MSFT.

    The Gov't SHOULD look at antitrust issues. Heck they are even pestering Intel these days. But scrutiny does not necessarily lead to punishment. The DoJ never punished MSFT, in spite of egregious behavior.
  •  
    Rokjok777
    Jun 16 10:37 PM
    Get a little more info before you spout, TomB. DoJ never punished MSFT? Sorry, your facts are wrong. DoJ dealt them a huge blow known as the Consent Decree and now MSFT is regulated by the Justice Dept as a monopoly. EU charged a fine of $565 MILLION for the unbelievable crime of bundling Windows Media Player with the OS....ooh MSFT is so evil for trying that. MSFT doesn't provide any useful services? Gee 400 million customers worldwide would probably disagree or else they would spend money on their product doncha think? . I love how people fall for GOOG's "don't be evil" when all the time they're gathering everything about your online activity, where you went online, how long you were there, where you clicked, now even what you bought with GOOG Checkout. If MSFT did that then we'd really hear some screaming. And what if MS launched a proprietary music download service with it's own proprietary compression algorithms (like Apple has done), people would be apoplectic...DoJ would probably be all over it.
  •  
    George R
    Jun 17 09:30 AM
    My Website
    Good morning, Michael

    In my view, you will see this begin to happen in 2009, not in the middle of an election year. The other issues where Google slipped under the radar screen during the past eight years of the current administration have been unlawful search activities and Intellectual Property violations.

    It would be very interesting, indeed, to learn what percentage of Googles's total search and advertsing revenue has been attributed to unlawful activites (child pornography, gambling, and the like) as well as items violating the copyrights of others (songs, articles, poems, recipes, artwork, photos, TV shows, movies, etc.).

    The "do no evil" days were a complete sham in my view, and I see this all of this catching up to them starting late this year.

    Have you noticed the number of law suits these folks from Mountain View spend their sharholders money on? It's shameful.

    They've been chewing on those apples for longer than you think!
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