Everybody Is a Loser When Competitors Flock to Antitrust Lawsuits

Published December 1, 2008

Google entered the browser wars in September (if any such war really exists) with the launch of Chrome, its new Web browser.

It’s good to see more competition in browsers, as I think—and I hope everyone else agrees with me—Firefox is the only real game in town.

Yes, Microsoft’s Internet Explorer is more popular, but that seems to be only because it ships with every Windows PC and because many enterprise Web applications require IE’s nonstandard browser. But Firefox is largely considered the preferred browser for anyone who works with the Web regularly.

One implication of this foray by Google into the browser arena is that—should Chrome be at all successful—the company will likely be accused of using its supposed search monopoly to squeeze out competition from IE and Firefox. That prediction assumes any features of Chrome would favor Google’s search engine, such as making it the default search tool for the browser, which seems likely.

Antitrust Wars

It’s funny to think Microsoft, the poster child of antitrust fights, could be the one launching such a lawsuit against Google. Just a few short years ago we saw Microsoft scoffing at the very notion of antitrust or monopoly power, arguing it was in no way using its market share to its own advantage. Now we may see the Redmond, Washington-based software giant lashing out against Google as a monopolist.

At a recent conference I had the unpleasant experience of watching a panel on online advertising devolve into a fight between the Microsoft and Google representatives over whether Google was a monopolist in Web searches and online advertising.

To be fair, Google has sued Microsoft over things as petty as Vista’s built-in MSN/Windows Live search. They may soon regret this lawsuit over built-in search because Microsoft could simply call up Google’s antitrust lawsuit, and replace “Microsoft” and “Vista” with “Google” and “Chrome.”

Leash the Legal Teams

Both companies would do well to put a leash on their legal teams and consider the implications of these lawsuits on the overall public policy landscape. By constantly using antitrust against one another, both companies legitimize the underlying notion of antitrust, namely that a company really can choke out competition by virtue of having a large market share.

That simply isn’t true. For example, Apple—long consigned to a tiny niche of the computer market—has made serious gains against Microsoft in the past two years. Apple now claims a 10 percent market share.

Similarly, Google remains very vulnerable to technological change. Anyone who figures out a decent way to search the growing amount of audio and video content on the Web will be on their way to blowing Google out of the water.

Sure, it will take a lot of money to catch up to Google, given its tremendous infrastructure, but the right technology will find money—whether it’s from venture funds or from a buyout by Microsoft, Yahoo, or even relatively new players in online advertising, such as News Corporation.

Illegitimate Challenges

We’ve seen both companies invoke antitrust challenges in illegitimate ways—to beat up on each other instead of trying to compete fairly in the marketplace. Instead of working on developing a superior or equal search program, it is just easier to sue Google. And instead of marketing desktop search programs effectively so more people adopt them, it is easier just to sue Microsoft.

Both companies should reconsider what they’re doing. Every time they endorse antitrust law as a legitimate public policy tool, they lend credibility to the efforts of their competitors to sue them for antitrust violations.

Instead, both companies ought to be touting the virtues of competition and explaining why their supposed monopolies are vulnerable to market competition just like any other business.

Such a pursuit would be to their advantage, better for the marketplace—and closer to the truth.

Cord Blomquist ([email protected]) is director of new media at the Competitive Enterprise Institute in Washington, DC. An earlier version of this article appeared at Techliberation.com. Reprinted with permission.