Menu Close

Is Google A Monopoly?

Guest Poster

Today, 40Tech is pleased to present a guest post by Kosmo from The Soap Boxers.

google monopoly

It has been 14 short years since Stanford students Larry Page and Sergey Brin founded Google. Since then, the company’s market value has skyrocketed to more than $150 billion and the company’s name has become a household word.

Photo by HarshLight

Like many successful companies, Google has decided to diversify rather than putting all of its eggs into the search engine basket. I personally use Google for:

  • Search engine
  • Email
  • Advertising provider
  • Website Analytics
  • RSS Reader
  • Webmaster Tools

That’s a half dozen tools that I use fairly frequently, and I’m not even a real “power user” – there are people who depend on Google products much more heavily. With Google having its hand in nearly every pie these days, have they grown into a monopoly that needs to be regulated or broken up?

They Could Put Me Out Of Business!

A friend of mine runs a successful blog and is concerned about the amount of power that Google has in the search engine space. A considerable amount of his traffic (and revenue) comes as a result of Google (as is the case for a great many bloggers). Changes in Google’s algorithms could result in his traffic being cut dramatically – costing him a considerable amount of advertising revenue.

While I can certainly empathize with my friend – since I also get a considerable chunk of traffic from Google – I happen to think that he (and others) are looking at this a bit backward. Who are the customers of Google’s search engine – the people searching, or the website owners? I see Google as the Lonely Planet guide to the internet – a travel guide to stops along the information superhighway. To take the analogy further, let’s say you own a restaurant that a popular travel guide reviews as a top choice for travelers. Suddenly, you’re booked solid and perhaps even think of opening a second location. Then, the next year, the travel guide doesn’t mention your restaurant at all – and traffic declines sharply. Can you be very upset at the publishers of the guide? Of course not – their job is to make the readers happy. Any benefit to you is incidental. It’s the same thing for Google – it’s nice if they drive traffic your way, but they don’t owe you anything.

Too Hard To Switch?

Is it too hard to switch from Google products, since they have their hand in everything? Earlier in this article, I mentioned that I use six Google products on a regular basis. How hard would it be for me to switch?

Search engine – If I wanted to switch to a different search engine, it’s pretty easy – just plug the URL of the search engine into my browser.

Email – I use Google’s mail servers for my own domain. Since these aren’t addresses, I could switch by making a few changes to settings on my domain registrar’s site. I’ve done this before, and I can assure you that it’s not a very big deal. For Gmail addresses, this is more difficult, but that has always been the problem with email addresses – unless you own the domain, they generally aren’t portable. There are so many different providers of email service that it seems a bit silly to suggest that Google has undue influence in this market.

Advertising provider – I use Google’s Adsense program for the ads on my site. Google does have some competitors in this space, and I have experimented with a couple of them, and have always come back to Adsense (some of the competitors show ads that aren’t very relevant). I have a WordPress plug-in (WhoSeesAds from Ozh) insert the ad code on the fly. It would be child’s play to replace this code with something from Chitika or a different competitor.

Website Analytics – Google Analytics is one of three products that I use for analytics, and not the one that I rely on most heavily. I think it would be fair to say that I have already switched to WordPress Stats for most of my analytics.

RSS Reader – I really don’t need a lot of bells and whistles, so I don’t have much of a reason to switch to a different RSS reader. However, it seems that there is a standard called OPML that allows you to export information about your subscriptions and then import this information into a new reader.

Webmaster tools – Switching to a different provider would generally mean adding a small bit of code to my site.

In addition to being a user of these six Google products, I am also a former user of Blogger. I made the switch to WordPress back in April of 2009, at the urging of a friend who declared WordPress to be superior. I was able to easily import all of my old articles from Blogger to WordPress in a matter of minutes.

Unreasonable Barriers To Entry?

One characteristic of a monopoly is that their actions cause unreasonable barriers to entry into the market. Certainly, companies wishing to compete against Google have an uphill battle. However, it’s important to note the different between a high barrier to entry and an unreasonable one. There are many industries in which new companies face difficult barriers to entry. If I wanted to start a car company, it would be extremely expensive and quite difficult to succeed – but I can’t honestly say that Ford, Toyota, Honda, Mercedes Benz, or Porsche have a monopoly.

I even question exactly how high the barriers are. Bill Gates famously said that a kid in a garage could put him out of business. This could happen to any number of Google’s businesses as well. If someone is able to find a way to charge advertisers less than Adsense does while paying web site owners more, that would be a sustainable advantage that could be used to drive Adsense out of business. It is unlikely that any one company could completely put Google out of business, but that’s the whole point of diversification – and not the mark of a monopoly.

Kosmo Bio: Kosmo is an aspiring novelist, vehement opponent of the designated hitter, student of true crime, and plays the keyboard for The Soap Boxers – an eclectic, team-written web magazine that touches on a wide variety of topics, including why strikeouts aren’t as bad as people think.