A new study claims that Google hurts consumers with its search engine that violates antitrust laws by displaying its own content more prominently.
Google has faced accusations of violating antitrust laws on several occasions, but a newly published paper now makes even more waves, following its presentation at the Antitrust Enforcement Symposium in Oxford, U.K. Columbia Law School professor Tim Wu, along with Michael Luca, assistant professor at Harvard Business School, co-authored this paper explaining how Google's practices are harmful for consumers.
It's worth pointing out that Wu, who is also a known Internet theorist, has collaborated with Google over the years, even working for the company in 2008, which makes him an unexpected opponent. Wu also worked with the FCC in 2011 and 2012, serving as senior adviser for drafting Internet traffic regulation. Wu is also well-known for his book titled The Master Switch: The Rise and Fall of Information Empires.
In this new paper, Wu and Luca focus on how Google is prominently displaying its own content in search results, which qualifies as an anti-competitive practice. More specifically, Google displays its own content at the top of search result pages, while other results are placed further down the line. Competing websites, meanwhile, often offer superior content, according to the study.
Popular review site Yelp was the one to pay for this study, and it also offered its own data scientists to help. As a reminder, Yelp is one of the main Google adversaries in the global antitrust war.
Competition regulators in Europe have already ruled that Google violates antitrust law, but Google argued that its practice of bundling its own content at the top of search results was a benefit to consumers. The new research contradicts Google's claim, detailing how Google's behavior hurts consumers.
"While Google is known primarily as a search engine, it has increasingly developed and promoted its own content as an alternative to results from other websites," highlights the paper. "By prominently displaying Google content in response to search queries, Google is able to leverage its dominance in search to gain customers for this content. This yields serious concerns if the internal content is inferior to organic search results."
To prove the point, the researchers went for a "randomized controlled trial." The team ran a set of blind A/B tests, involving 2,690 Internet users who received two versions of search results in response to their queries regarding local businesses. The researchers aimed to compare Google's current policy of displaying search results with its own content with other search results which also display external content.
"We find that users are 45 percent more likely to engage with universal search results (i.e., prominently displayed map results on Google) when the results are organically determined," conclude the data scientists.
The paper further points out that Google is harming consumers with this practice, as it is dominating search results with its own internal content when it could provide higher-quality results and better matches for consumers' searches.
The study notes that Google seems to intentionally deploy universal search in a manner that pushes aside rivals to its search paradigm. Wu explains how it may be legally acceptable to hurt competitors when you're helping consumers, but to hurt both competitors and consumers at the same time is an unacceptable conduct.
Lastly, Wu says he greatly admires and respects Google, but in this case the company is wrong and its practices are harmful.
