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Ganging up on Google

Ben Woodhead (MIS Australia) | May 20, 2009
The search engine's phenomenal growth is matched by a growing chorus of criticism.

Google argues that its search and advertising technologies have helped to create new opportunities and generate enormous amounts of revenue for businesses on the web. It notes that it directs more than a billion clicks each month to newspaper websites and that its AdSense advertising program paid out $US5 billion to media partners last year. The company reported revenue of $US21.8 billion for the year to December 31, 2008.

Murdoch and Google chief executive Eric Schmidt did agree on one thing this month: that content creators had to innovate more effectively rather than blame new technologies. But they differed on how this could be achieved. Murdoch says News is likely to lock more of its content behind subscription paywalls while Schmidt, not surprisingly, favours freer access for consumers.

The issue of how Google profits from the work of others is a major flashpoint for the company and it's also at the heart of one of the competition inquiries the company now faces. The inquiry centres on a $US125 million publishing settlement that enables Google to digitise millions of books, including so-called orphan titles - publications that are still under copyright but the holder of the copyright is unknown.

Parties to the Google Books settlement include the Association of American Publishers and the Authors Guild. Harvard University, Stanford University and the New York Public Library are among participants in the project.

Critics of the settlement, which include the estate of US writer John Steinbeck, worry that granting only Google immunity from copyright infringement claims on orphan books will make it harder for other organisations that might seek to establish a competing digital library.

In February, in The New York Review of Books, Harvard University's Carl H. Pforzheimer university professor, Robert Darnton, foreshadowed the concerns.

"Google will enjoy what can only be called a monopoly - a monopoly of a new kind, not of railroads or steel but of access to information," Darnton wrote.

Google is likely to take the view that the settlement does not prevent any organisation from negotiating a similar arrangement of its own. However, the argument that Google has grown too influential, even if it does not abuse its market dominance, is one that is gaining currency by the day.

"When you look at Google, it's not that Google has actually done anything that anybody can point to that's been anti-competitive," Foer says.

"It's much more that they are becoming so big and they are so creative and able to reach out and do amazing things that affect so many people in key ways - control over information flows is critical to democracy - that it's natural that there be a lot of scepticism even though they say all the right things."


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