MBA 505 students will study monopoly and antitrust this coming week. In discussing the economic consequences of monopoly power and reviewing some key cases (e.g., Alcoa, Microsoft), we will also be looking at Google's situation. Numerous press reports (see this summary in Wired) indicate that the Federal Trade Commission is considering a suit before the end of the year and that the European Union is doing likewise.
Google has about two-thirds of the search engine market. This might qualify as a monopoly in and of itself but it does not appear that regulators are concerned on this front. There was a time not too long ago when Yahoo! was on the top of the heap; Google took Yahoo!'s place by having a better product.
A key issue in the suit appears to be whether Google favors its own products in search results and thereby extends its monopoly in other product lines. Examples cited by NYT include Google Shopping, Google Places, and Android.
My take: I really doubt that Amazon, Yelp and Apple are worried about whether and how Google manipulates search results. Monopoly power in today's internet world is ephemeral. Remember the big IBM monopoly? Lotus 123? Microsoft Office/Windows? It will take five or more years for any Google antitrust case to be settled and one has to seriously wonder what the world of search will look like at that time.
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