The U.S. Senate Judiciary Committee’s hearing yesterday on Google was closely watched for parallels to Microsoft’s antitrust quagmire of the 1990s. At a similar hearing in March 1998, Bill Gates insisted to some of the same senators that the company didn’t have monopoly power. Two months later, the government filed its landmark antitrust case against the company.
When the same question came up yesterday about Google, Eric Schmidt, Google’s executive chairman, was clearly determined to avoid the same pitfall. In fact, his response was so carefully delivered that it was interpreted by various sides of the issue as either confirming or denying that Google has monopoly power.
This was the key exchange …
“But you do recognize that, in the words that are used in antitrust kind of oversight, your market share constitutes monopoly … special power, dominant firm, monopoly firm. You recognize you’re in that area?” asked Sen. Herb Kohl, a Democrat from Wisconsin.
“I would agree, Senator, that we’re in that area,” Schmidt said, but then pointed out that the question of monopoly power is traditionally determined through a judicial process. “From our perspective, we see ourselves as having a special responsibility to debate all the issues that you’re describing with us now. We do understand it.”
Later, Susan Creighton, a former FTC official who works as an outside antitrust counsel to Google, was more direct in saying, “I do not believe that Google does have monopoly power,” citing the fact that consumers can easily switch to another search engine.
Watch clips of both exchanges in the video above.