Comparison shopping engine Nextag and its CEO Jeffrey Katz have been at the forefront of accusing Google of being a monopoly and abusing its position to crush smaller competitors. Today, the Wall Street Journal ran an opinion piece by Katz that accuses Google of not just promoting its own services and products on its search results pages, but also selling out its users because many of “the most prominent results are displayed because companies paid Google for that privilege.” Google, in what’s becoming an increasingly common tactic for the company, just published a detailed (and rather aggressive) response to Katz’s accusations. In it, the company’s senior vice president of engineering Amit Singhal argues that “there has never been as much choice online as there is today.”
Google gave Katz an opening for his attack when it launched Google Shopping and its new paid product listing ads last month. These are basically ads that also feature prices and product images and which will appear right underneath the standard AdWords text ads that often adorn the top of your search results pages today. Katz doesn’t specifically mention this new service, but it seems likely that this is what he’s hinting at when he argues that “Google should disclose, clearly and in plain English, when advertisers receive better placement in search results and when a result is a Google-owned property.”
Katz also argues that “it’s easy to see when Google makes changes to its algorithms that effectively punish its competitors, including us.” Google’s response to this: “We built search to help users, not websites.” In his response, Singhal stresses that Google doesn’t make changes to its algorithm to hurt competitors. Katz, of course, doesn’t believe this for a second and argues that Google “has shifted from a true search site into a commerce site—a commerce site whose search algorithm favors products and services from Google and those from companies able to spend the most on advertising.”
Katz also gives some advise to European Union Commissioner Joaquín Almunia, who is responsible for Competition and who is expecting a response to his anti-trust concerns regarding Google next month. The Nextag CEO argues that Google needs to become more transparent about when advertisers get better placement in search results and when a result is a Google-owned property” (Google, interestingly, doesn’t answer this charge).
Google: “If users don’t like our results, they can try Bing,Yahoo, DuckDuckGo, or even Google Minus Google.”
In addition, he says that Google needs to be less biased and “should also allow users to reduce the number of ads shown or incorporate a user’s preferred services in search results.” Google’s answer to this is pretty straightforward: “If users don’t like our results, they can try Bing, Yahoo, DuckDuckGo, or even Google Minus Google.”
Katz’s last recommendation may just be the strangest of the bunch, though. He says that Google “should grant all companies equal access to advertising opportunities regardless of whether they are considered a competitor.” Given that Google’s advertising system is based on an auction-system, I’m not sure what Katz is hinting at here (feel free to let me know in the comments if you have an idea).
Maybe a discussion about whether Google behaves like a monopoly and is treating its competitors unfairly is worth having. I’m not sure Katz’s arguments today really add much to this discussion, though. Katz obviously wants his old search engine rankings back. His issues, it feels to me, are more about that than about whether Google is a monopoly or not.