Why Is Google On Washington’s Radar?


Google is apparently under a permanent fire. The U.S. Justice Department is investigating Google’s activities to arrive at a conclusive stand about whether or not the technology company has violated laws, reports by Reuters say.

Google already faces complaints from rivals as well as Democrats and Republicans, and the GDPR has slapped EU regulatory actions. The fines are mounting and have already added up to multi-billion dollars and reforms to Google’s business practices.

This appears to be another episode in a string of attacks on Silicon Valley companies, and could well be one of the biggest steps that Trump administration took towards regulating the technology giant. Soon after news of the possible Google probe, Republican Senator Josh Hawley said on Twitter: “This is very big news, and overdue.”

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But what exactly is transpiring?

Google has been the biggest example of a start-ups growing to dominate the market, from a small search engine to one of the richest companies in the world. Its android OS runs most of the world’s mobile phones and it controls much of the technology that runs online ads. In fact, its digital advertising revenue amount to almost 85% of the revenue for Alphabet last year.

It is not surprising that some other brands find this dominance discomfiting, and complain that Google unfairly skews search results and uses its market dominance to promote its own services over theirs. However, Google has always maintained that it is transparent as far as its own services are promoted and its full focus is on what is best for their consumers.

Earlier, in 2013, the U.S. Federal Trade Commission had investigated Google’s business practices and the resulting settlement was a softer step for Google, since it got away by just making minor changes to its practices. Its focus on its own services could continue, apparently. However, there was definite pressure to end the practice of “scraping” reviews and other data from rivals’ websites for its own products. They could also not let advertisers export data to assess campaigns independently.

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More recently, Europe’s competition authority has handed down three fines amounting to more than $9 billion. In a 2017 deal with the EU, Google had to pay $2.7 billion, after it was accused of unfairly steering business toward its shopping platform. In March, it faced a fine amounting to $1.7 billion for illegal practices in search advertising brokering from 2006 to 2016.

Theoretically, DoJ could shut down the company but it is not likely to do so, because that would require legal action first. The DoJ would have to file a lawsuit and convince judges that Google has undermined competition. While there are precedents (in Standard Oil and AT&T), more often the Justice Department antitrust probes result in an agreement to change certain business practices.

Critics of Google in Washington include the United States’ top general who recently said the Chinese military was benefiting from the work Google was doing in China.

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