Extraordinary: the FTC says it is OK for Google to bias search results in its own favour

The most remarkable statement in the report from the US Federal Trade Commission’s investigation of Google is this one:

The FTC concluded that the introduction of Universal Search, as well as additional changes made to Google’s search algorithms – even those that may have had the effect of harming individual competitors – could be plausibly justified as innovations that improved Google’s product and the experience of its users. It therefore has chosen to close the investigation

In other words, the FTC did not find that there was no bias in Google’s search results. It found that bias is OK if it “improves Google’s product and the experience of its users”, a phrase which is something I would expect to hear from a company’s own public relations team, not from a government report.

It is an extraordinary conclusion and runs counter to normal expectations of what a government body investigating anticompetitive business practices would be likely to support. It does make me wonder if the FTC appreciates the power of Google over which web sites are visited; given the use of the search engine by people such as students and journalists the company has remarkable potential influence over a wide range of human knowledge, as well as the power to make or break a company for which the web is critical either for direct sales or for marketing.

I also wonder what precedent it sets. In other words, can any company justify activities that harm competitors unfairly by claiming that they “improve the experience” of customers?

Update: It looks like the EU may take a stronger line, according to this article in the Guardian. From which I cannot resist posting a screenshot.

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13 comments on this post.
  1. Hermit Dave:

    that is very strange indeed. Microsoft was found guilt of abusing monopoly in similar situations.. lets see what EC makes of it

  2. Brian Lesser:

    That’s one way to read that sentence. Another way is that the FTC found no evidence that Google was deliberately de-emphasizing competitors. In other words the FTC accepts that Google can adjust its page rank algorithms and that rankings will go up and down as a result.

  3. tim:

    If it said that, it would not bother me (though my own observations suggest otherwise). But how is this ambiguous: “additional changes made to Google’s search algorithms – even those that may have had the effect of harming individual competitors – could be plausibly justified as innovations”

    It says that harming competitors is OK if you are innovating. And “innovating”, as we know, means whatever you want it to mean.

    Tim

  4. Brian Lesser:

    It doesn’t say intentionally harm competitors. Remember, companies hate having their page rank reduced and complain that it harms them financially. I think the FTC is saying it is OK for competitors (and others) to have their rank reduced when Google optimizes their page rank algorithm. The FTC does not appear to be saying this is an intentional anti-competitive practice on Google’s part. If they had found evidence of that I imagine they would have taken much stronger action.

  5. Brian Lesser:

    The FTC pretty much dismisses allegations of bias this way:

    “Similarly, we have not found sufficient evidence that Google manipulates its search algorithms to unfairly disadvantage vertical websites that compete with Google-owned vertical properties.”

    Here’s the FTC document that specifically addresses the accusations of search bias:

    http://ftc.gov/os/2013/01/130103googlesearchstmtofcomm.pdf

  6. Alex Atkin:

    If you go into Sainsburys its expected that they will be pushing Sainsburys brands to the most prominent positions in the store and price them to undercut their competition. How is what Google is doing all that different?

    Google search is not a monopoly, the fact people are largely unaware of the alternatives is a testament to how well Google works and the sheer power of word of mouth. The fact they are exploiting that fact, big surprise, they are a business after all. Its only anti-competitive if they are completely omitting results of their competitors, deliberately pushing them onto page 2, I see no evidence of that.

    In the real-world, what they are doing is not a big deal at all. As I am example I just tried doing a search for “sheffield map” on Google and Bing, the results are not all that different at all.

    Okay so Google put a bigger Google map on the page than Bing do for theirs, and its right at the top whereas Bing prioritise image results over their maps service. Neither is inherently wrong or right, but I would argue that how Google have done it is actually more useful to me as a Google user. In fact one of the reasons I prefer Google over alternatives is that sort of useful functionality.

  7. tim:

    Alex

    Google is different because it has a much larger share of the search engine market than Sainsburys has in the retail market. With great power comes great responsibility.

  8. William Carleton:

    With respect, I’m not sure the FTC so much found “no bias” as it found there wasn’t a violation of law.

  9. Brian Lesser:

    The FTC said they didn’t find sufficient evidence of bias:

    “we have not found sufficient evidence that Google manipulates its search algorithms”

    I don’t understand how you get from that to saying “the FTC says it is OK for Google to bias search results”

  10. tim:

    well, we can argue about the word “bias” but it is not an unreasonable word in my opinion. Consider this statement from the document you reference:

    “While Google’s prominent display of its own vertical search results on its search results page had the effect in some cases of pushing other results “below the fold,” the evidence suggests that Google’s primary goal in introducing this content was to quickly answer, and better satisfy, its users’ search queries by providing directly relevant information.”

    This is saying that it is OK for Google to promote its own products at the top of search results if it the goal is to “better satisfy users search queries.”

    Who is the judge of this? Google.

    The problem I have with this is that better satisfying users is nebulous while the effect on competitors is not.

    Even if Google’s behaviour is impeccable my view is that a dominant position in search is a force of such power that it should be regulated so that an even handed approach is assured.

    I am not a lawyer and have no opinion on the legal aspect.

  11. Brian Lesser:

    Well in this instance, Google is not the judge of this. The FTC was:

    “The totality of the evidence indicates that, in the main, Google adopted the design changes that the Commission investigated to improve the quality of its search results, and that any negative impact on actual or potential competitors was incidental to that purpose.”

    Also:

    “We also note that other competing general search engines adopted many similar design changes, suggesting that these changes are a quality improvement with no necessary connection to the anticompetitive exclusion of rivals.”

    Again, “with no necessary connection to the anticompetitive exclusion of rivals”

    And on and on…

    When I read the entire FTC document I get a different message than you did. The charges against Google by its competitors and the initial FTC interest was dominated by the accusation that Google search results were biased. After a 19 month investigation the FTC has all but said, by a count of 5 – 0, that they are not.

    The EU may take a different view, but it seems there is a lack of evidence on search bias. And search bias is the context here.

    Without sufficient evidence of anticompetitive search behaviour that damages consumers, I don’t see why (ethically or legally) any agency would push for regulation. Monitoring yes, but not regulation.

    Time for me to leave this subject behind. Good talking to you Tim.

  12. tim:

    Brian, thanks for your comments which are appreciated. What I mean when I say Google is the judge, is that it is Google not any other entity which decides how its search ranking is ordered and merged with advertising, and as the FTC notes it gives its own products and services prominence. The FTC says this is OK provided Google claims it is beneficial to the customer experience which is exactly the point I made in my original post.

  13. Burak KALAYCI:

    I’ve been thinking about this post, and I cannot find a single reason how this is extraordinary or unexpected.

    Google provides a search service, and it should be biased, otherwise all search services should be providing same search results and governments should take over the search business.

    What if Google puts a disclaimer that says ‘Dear user, search results you will get here are biased as we find fit’. (That would be the same as warnings on mugs that say ‘content may be hot’). Will all be OK then?

    If EU decides otherwise it will be because they want Google’s money. Just like they wanted MSFTs money in the past. I don’t think their decisions are credible.

    > In other words, can any company justify activities that harm competitors unfairly by claiming that they “improve the experience” of customers?

    This happens all the time. When was the last time a company told you to go to another company because it will be for your best interest?… Unfairly? What is unfair and who decides that? Does Bing have a notice that says ‘For better results, go Google it!’? How is that not unfair practice?