Google Claims Amazon Is Its Biggest Rival in Search

Google has had a rough time of late, excluding financial performance, of course. But in the realm of public opinion and its reflected self-image, it can't seem to escape the pressure of just being so damned successful. 

Controlling 90 percent of a market as big as search will tend to draw regulatory attention, to say nothing of a horde of competitors only too willing to keep pointing fingers like 6 year olds at recess who see a classmate wet his pants. Let's face it, when a company with the appalling record of Rupert Murdoch's NewsCorp believes it can get away with attacking the moral rectitude of any other enterprise, you know you're in trouble.

So it is fascinating to examine the spin moves that Google's Eric Schmidt is employing in an attempt to deflect some of the attention - and heat. This is so clever as to be text book: identify another tech company, like, say, Amazon, which is a theoretical future competitor, or at least one certainly capable of becoming so, but which is not the obvious, popularly perceived aggressor in that space. Especially one with monopolistic issues of its own in a different realm like ecommerce. Claim they are your most serious competitor - and then watch what happens. Attention is drawn to the claim and to Amazon, marking them for future regulatory consideration (not that they werent under scrutiny already.).

The reality is that this is unlikely to accomplish any long term diminution of interest in Google's alleged excesses, especially when the European authorities have their own tech sector to bolster. But it does suggest that Google will not go quietly - or alone. JL

Jeevan Vasagar and Alex Barker report in the Financial Times:

"Many people think our main competition is Bing or Yahoo. But, really, our biggest search competitor is Amazon”, pointing out that internet users are likely to go directly to the retailer if they are shopping.
Google’s Eric Schmidt claimed on Monday that his company’s biggest rival in search is Amazon, in a speech that confronted critics of the US group’s market power by stressing it was just one of many “windows on to the web”.

At a time when Google is under intense political pressure in Europe, Mr Schmidt argued in Berlin that the company should not be regulated as if it were the gatekeeper of the internet, given the influence of US rivals such as Amazon and Facebook.

The company's executive chairman pointed to the fact that the next generation of internet users was focused on mobile search: “And the most popular app in the world – including in Europe – is Facebook, a company which now describes itself as the on-ramp to the internet.”

In search, he said that “many people think our main competition is Bing or Yahoo. But, really, our biggest search competitor is Amazon”, pointing out that internet users are likely to go directly to the retailer if they are shopping.

He made a similar case to publishers, saying that users are most likely to go straight to a news service. German tabloid Bild, “the most widely read newspaper in Europe, gets around 70 per cent of its traffic directly”, he said.

Claims by travel companies, such as Yelp and TripAdvisor, which have complained about Google’s anti-competitive conduct, were also challenged by Mr Schmidt, who said they had thrived in spite of claiming Google was endangering their business.

“The reality is that Google works very differently from other companies that have been called gatekeepers and regulated as such . . . No one is stuck using Google,” he said.

Critics have frequently pointed out that establishing a search engine requires a high level of spending on research and infrastructure, while the dominant search engine benefits from having the most access to data on user behaviour.

The company, whose general web search service has a market share of more than 90 per cent in Europe, has come under sustained regulatory pressure.

A four-year European Commission investigation into Google’s search practices is moving closer towards formal charges, after Brussels rejected Google’s third attempt to settle the case. The “right to be forgotten” court ruling has forced it to remove thousands of links from its European search service.

Google is facing a separate investigation by European authorities into allegations that it supported the Android smartphone platform and mobile services by striking cut-price deals with manufacturers.