Who thinks it wise to allow a single company to corner the global market for any set of critical inputs to the global economy — like stocks, bonds, currencies, industrial metals, precious metals, energy resources, grains, food, or livestock — with no regulatory oversight, transparency or obligation to be an honest broker?
Why then, if “information is power” in commerce, society, and governing, has the world allowed Google to anti-competitively corner the global market for the world’s information?
To spotlight this extraordinary risk and exceptional lapse in sovereign accountability, my new research provides new insight into how Google has become the most powerful commercial monopoly the modern world has ever seen.
In Brussels last week, I presented my latest Googleopoly analysis – here: “Google’s Information Is Power – Info-opoly Power” — at a public ICOMP event and at several other meetings.
My new “Google’s Information Is Power” analysis has five big conclusions/takeaways.
First, the analysis exposes Google’s unmatchable hoard of the “world’s accessible digital information” to be a global consumer info-opoly. Google commands multiple unmatchable corpuses of information: searchable links/URLs; maps; news sources; books; videos; apps; facts; art; etc. The analysis sheds light on what is inside Google’s ‘black box’ info-opoly.
Second, the analysis shows Google’s info-opoly to be enduring, given Google’s overwhelming barriers to competition. Google’s only potential competitors — Facebook, Microsoft, Amazon, and Apple — are in businesses very different from Google. And any potential info-competitor would start ~$300b and ~10-18 years behind against one of the world’s most financially powerful companies, which is defended further by exceptional infrastructure and expertise advantages, and unprecedented internetwork effects. Rather than “competition being a click away,” its several hundred billion dollars and decades away at best.
Third, the analysis exposes that Google effectively has admitted publicly to a predatory Android pricing and cross-subsidization strategy. After Google was ruled dominant in search and search advertising syndication in 2008, Google predatorily set a price of zero for an Android operating system that Google readily admits: was very costly to build and operate; and used its monopoly search/advertising profits to cross-subsidize and drive several mobile operating systems from the market: Symbian, Windows, Blackberry and others.
Fourth, the analysis shows Google has engaged in a predatory pattern of behavior in dictating a wholesale price of zero for info providers’ information. For the first time, the analysis uses Google’s own pricing model insights to expose Google zero-pricing strategies and how they are anticompetitive. While it is legal and pro-competitive in multi-sided markets to offer a zero price to users, to recoup one’s costs, and make a profit by charging another side of the market a premium like Adobe does with free PDFs for users and publishers paying all of users’ costs in ~$300 priced Acrobat. However, Google’s abuse of its dominance is forcing proprietary information owned by others to be priced at a wholesale price of zero to access Google’s monopsony over global demand for their information. The analysis also sheds light on Google’s ‘black box’ pricing model and provides seven examples of Google’s pattern of predatory pricing in forcing many different types of information providers to offer their information at a wholesale price of zero to reach global demand.
Finally, structurally, Google can be divided into three key parts for antitrust purposes: information, information-access, and advertising, which divides Google consistently in four dimensions: production and distribution; wholesale and retail; horizontal and vertical; and most importantly, fixed cost infrastructure and variable cost software.
Please see: www.Googleopoly.net for more Google antitrust and accountability research.