This week Yelp produced a study showcasing just how aggressively Google was messing with their search engine. The study was funded by Yelp but done by Harvard Business School economist Michael Luca and Columbia Law School profession Tim Wu. While Wu had maintained that Google’s search practices were fair, at the conclusion of the survey he changed his opinion and felt they were doing consumers harm.
Now Google and others will shoot at this survey saying it was corrupted by Yelp’s funding, and Yelp itself isn’t exactly known as the champion of fairness. However I doubt either researcher would risk their long term credibility (and thus their income) for one high profile project. Given Google search is largely believed to be the cause of the collapse of magazine and newspaper publishing, could swing elections, and has given Google so much power they appear untouchable; what if the government changed this up and either made search a government service (it could certainly fund Obamacare and the US Post office combined) or made it into a regional utility like PG&E or Comcast? Basically a powerful entity that was heavily regulated to offset its unique monopoly like power? Given how effective Google has been at pissing off governments I think one of these two outcomes is eventually very likely.
Let’s chat about that.
Too Much Power
This isn’t the first time a company got too much power and was curtailed by the government. The original Standard Oil, RCA, the original AT&T, IBM, and Microsoft have all had their time with the government. The first three were broken up, the second two agreed to sign agreements that weakened them substantially and none of them are near the power they once held. Google has arguably reached a point where their power rivals that of the government suggesting that shortly one or more governments will take this seriously as a problem to be solved. Given Google has largely been unsuccessful in diversifying their revenue stream significantly any major government action could be catastrophic to Google’s revenue and future aspirations.
Given their control and connection to the current administration there is a reasonable chance that the next administration will make taking them down a notch or ten to be a powerful political move. But which path would you take?
Utility
Out here in the west we have a variety of big utilities who aren’t known for behaving well. Comcast which provides much of the cable TV and internet coverage has one of the lowest satisfaction scores on the planet and has a nasty history of throttling customers who use their services heavily. PG&E has been accused of corrupting government officials and covering up significant problems that have caused massive numbers of premature death.
This suggests that the utility approach might not make things better, it would just turn Google into a more aggressively corrupt entity that might even do more damage and have even lower priorities with regard to customer satisfaction.
Government Owned
Here the Post Office is likely the best example and the most likely place to put Google core business. The extra revenue could more than make up for the Post Offices historic deficit and, at least lately, the US Post Office has been doing a nice job with regard to customer satisfaction now even more aggressively used by Amazon as an alternative to UPS and FedEx. Granted not all government services are like this, the Veteran’s Administration is a nightmare that never ends for some, Medicare has been all over the map, and the reviews are decidedly mixed with Obamacare. However Google search would have little to do with any of these failing efforts and the US Post Office appears to be in vastly better shape than it was a few short years ago suggesting this is the path that should be considered.
Wrapping Up: Freedom
It is getting kind of bad with regard to Google. They are apparently immune to fines now, have a desire to force us to drive cars that look like a large pidgin poop, and some are treating their name as synonymous with evil. In the end I think one or more governments will step up and attempt to more heavily regulate the company, what they likely should do instead is nationalize search and then mine the related revenue to cover budget shortfalls. Let’s see if that is where they end up.
