Yelp to Congress: Don’t investigate Google without looking at search

Arguing to widen the investigation. Yelp is seeking to broaden the scope of the Justice Department and Congressional inquiries into Google. Lowe testified, “There have been concerning reports that the state attorneys general and the DOJ are pursuing incredibly narrow theories of harm in their respective Google investigations, only looking at advertising technology. I believe making the focus too narrow would be a grave mistake.”

He added, “For years, Google, in particular, has biased its [search] results to serve its interests and leverage its power to entrench it further and hurt consumers in the process.”

Google, of course, argues that changes in the SERP (Featured Snippets, Answer Boxes, Local Packs) benefit consumers. And there’s some evidence that consumers, on balance, like these SERP features. But many competitors believe that Answer Boxes and Local Packs “siphon off traffic” that should be going to them — the zero-click phenomenon.

Case closed in 2013, now reopened. In 2013, the FTC closed a roughly 19-month antitrust investigation without imposing any fines or significant penalties on Google. Since that time the European Commission has found the company in violation of European antitrust laws three separate times and imposed significant penalties on the company, requiring changes in the way it handles third party content.

Also since that time, American lawmakers have shown renewed interest in bringing antitrust scrutiny to major U.S. tech firms: Google, Facebook, Apple and Amazon. There are multiple, active antitrust investigations now pending at the Justice Department, as mentioned, the FTC and being pursued by a nationwide consortium of state Attorneys General. Some of those efforts are being coordinated.

Google confronting a new political climate. We’re in a very different economic and political climate than we were in 2013 and Google faces critics in Congress on both the left and the right, a situation it hasn’t encountered until recently. Facing an existential threat from Google, Yelp sees this moment as an opportunity to arrest Mountain View’s unabated march toward local search dominance. Yelp has made similar regulatory appeals for more antitrust attention to local in Europe.

Yelp’s arguments aren’t new or entirely persuasive, but they will likely have an impact on now-receptive lawmakers. Among the things that Lowe said in his Congressional testimony today were the following:

• The question that policymakers have to answer is this: What purpose does elevating OneBoxes to the top of the page (while excluding rivals from the OneBox) serve? Does this serve to bring users more relevant information, or does it merely serve to protect Google’s search monopoly?
• For all the right Google has done, and for all the potential that the internet offers, Google’s deceptive self-preferencing, especially in the local search market, is creating clear anticompetitive effects.

Why we care. To head off a local antitrust action in Europe, Google recently introduced a new presentation of search results that privileges certain directories and presents them above the Local Pack. While it’s unclear whether the European Commission will see this as a meaningful effort to drive more traffic to directories and local search competitors, it may be a preview of a solution that could come to the U.S.

However the U.S. investigations are still ongoing and it’s far from clear what their outcome will be. But this time it probably won’t be business as usual.