Saturday, January 5, 2013

Google, competition and the one, perfect result - Washington Post

In a 2005 interview, Eric Schmidt said that, ideally, a Google search should yield only a single, perfect result.

“When you use Google, do you get more than one answer? Of course you do,” he told public television host Charlie Rose at the time. “Well, that’s a bug. We should be able to give you the right answer just once. We should know what you meant. You should look for information. We should get it exactly right.”

Fast forward to Thursday, when the Federal Trade Commission (FTC) ended its two-year antitrust investigation into the search giant. The FTC found that, contrary to claims made by Google’s detractors, there was not sufficient evidence to show Google unfairly prioritized its own products in search results over those belonging to companies that offer competing services. In a deal with the FTC, Google also voluntarily conceded to change the way it displays portions of content from other sites and make it easier for marketers to move their ads to competing services. Google’s detractors, under the banner issued a statement Thursday calling the deal and the end of the investigation “disappointing and premature.”

But the decision left me thinking about the potential ramifications of what Schmidt described in 2005. Could competition exist in online search if Google was able to deliver a single, perfect result every time? I don’t believe it could.

When asked whether Schmidt’s description was an accurate representation of the company’s current goals, a Google communications representative referred me to CEO and co-founder Larry Page’s 2012 letter to investors. In it Page writes, “Truly great search is all about turning your needs into actions in the blink of an eye. ... It’s all about speeding things up so users can get on with the things that matter in their lives.”

Indeed, I believe Google’s latest advances to achieve what Page describes â€" to say nothing of the goal Schmidt outlined â€" stand to increasingly shrink the potential role of competitors. For instance, Google recently upgraded its search engine to parse the meaning of words, a process known as “semantic search.” The feature is meant to solve the “hotdog” search problem, as Schmidt explained in his interview with Rose:

“Is it a ‘hot dog’ or a ‘hotdog.’ And, if you knew something about whether the person had dogs, or whether the person was a vegetarian, you’d have a very different potential answer to that question.”

This development stands to give Google a leg up, for example, on restaurant search engines and map competitors such as Yelp and Microsoft’s Bing. The search giant could, thanks to its acquisition of Zagat, recommend a reviewed restaurant, provide a map to that location, and a sponsored coupon before a user was presented with other search results.

Additionally, one of the company’s latest endeavors â€" to predict searches before users are even aware they need information â€" could present an even greater challenge to competitors. For example, one of the company’s latest products, Google Now, intends to provide information a user needs the moment they need it. For example, the service alerts a user about an alternate route if, say, there’s a traffic accident or other obstruction on the more direct path. Such a service could bypass the need for users to visit other traffic-data repositories.

Google is also conducting “pre-search” studies to determine what kinds of information a user might want but might not think to Google, likely spelling even more bad news for competing services. After all, such a feature would be all but impossible to re-create or build on without Google’s uniquely large volume of data.

There is a difference, as FTC Chairman Jon Leibowitz has stated, between competition and competitors. The nation’s monopoly laws were established to protect the former, he said, and not the latter. But technology will continue to change the nature of competition and choice. As more decisions get off-loaded to increasingly advanced algorithms bordering on artificial intelligence, the old anti-trust rules may not apply. Over the long term, I predict one of two things will have to change: Google or the meaning of monopoly.

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