Making Results Better For End Users Isn't Acting Like A Monopolist

from the and-again-and-again-and-again dept

With the Justice Department getting closer and closer to going after Google for supposed antitrust violation, we're going to see more and more articles like the one in the New York Times this weekend that tries to highlight the story of a company "harmed" by Google's market power. In this case, it's the story of a guy who runs a directory site that was based entirely on Google arbitrage. He bought ads on Google's search engine to drive people to his directory page, and then littered the page with AdSense to collect revenue from people clicking through. The NY Times presents this as being somewhat harmful, but I have to side with Jeff Jarvis who doesn't see what Google did wrong.

Google arbitrage sites are a problem for the end user. They're based on the simple concept of forcing people to go an extra click to siphon some money away. If I'm looking for a particular site on Google I don't first want to go to a directory -- I want to go directly to the site. That's true for many, many users -- and Google's efforts in punishing arbitrage sites isn't anticompetitive, it's about improving the user experience, which is something that should be praised, not sued. The only problem noticed in the scenario was that the guy chose a bad business model, where he was totally reliant on a single company for both all of his traffic and all of his revenue. He made the decision to base his entire business on a single supplier, and that supplier has every right to change the terms of its deals in an effort to make a better consumer experience. This isn't Google being anticompetitive -- it's Google serving its customers.
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Filed Under: antitrust, arbitrage, monopoly, search results
Companies: google


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  1. icon
    isaac K (profile), 15 Sep 2008 @ 3:53pm

    Re: Re: Three points

    Just an additional comment:

    Third, why do site-owner feel the need to sue Google when their "click pass-through" site no longer makes money? How about suing Firefox for allowing users to block ads? How about suing users for having sense to avoid ad-covered sites? How about suing themselves for almost training users to ignore ad-laden sites?


    I agree except for one thing: the sole reason that this person is failing to make money is because Google CHOSE TO RAISE HIS MINIMUM BID in such a manner that he is UNABLE to make money. Google directly acted against HIM personally and HIS MODEL to EXCLUDE HIM from being able to post ads. That is what worries me from an economic perspective, as this DOES smack of monopolistic power.

    Honestly; This is similar to the AppStore delisting the iamrich program. It might not DO anything for the user, but if people WANT to use it, then let them. It doesn't harm apple (google) and in fact generates MONEY for them, but they decided to exercise their prerogative for "quality control" and remove it (apple) or modify it's terms (google)

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