The federal government’s first attempt at a monopoly in the modern Internet era is less than a week old, but a central character has already emerged: data. Its role, use and power are key questions in the Justice Department’s lawsuit against Google.
The government claims that Google bribed and bullied smartphone makers like Apple and Samsung, as well as browser maker Mozilla, into being its flagship search engine, thereby funneling much more data to Google and cutting off competition.
According to the government, data is the engine of Google’s success. Each search query adds data, which improves search results, attracting more users who generate even more data and ad revenue. And Google’s ever-growing data advantage, the government argues, poses an insurmountable obstacle to its competitors.
The data is “oxygen for a search engine,” Kenneth Dintzer, the Justice Department’s lead attorney, said in his opening statement Tuesday.
The government does not claim that Google violated the law by becoming a search giant. Instead, the government claims that after Google became dominant, the company broke the law with its tactics to defend its monopoly. Contracts with industrial partners to make it their default search engine constituted the weapon: exclusive agreements which eliminated competitors, says the government. Google is now protected from competition behind a fortress built with data.
Google responds that the government’s argument is a misleading theory, unsupported by the facts. The government has chosen to “ignore inescapable truths,” John Schmidtlein, Google’s lead lawyer, said in his opening statement.
These truths, according to Google, are that the company occupies its leading position in search thanks to its technical innovation. It competes with others for default placement contracts and wins mainly because Google is the better search engine. According to Google, these contracts help reduce smartphone prices and benefit consumers.
The government, Google insists, overestimates the importance of data. In a brief filed this month, the company said: “Google does not deny that user data can improve search quality, but Google will show that there are diminishing returns to scale.” »
The trial resumes this week and the Justice Department continues to present its arguments. The first witness scheduled to testify Monday is Brian Higgins, an executive at Verizon who oversees mobile device and customer marketing. The trial is expected to last 10 weeks. A decision by Justice Amit P. Mehta will be issued next year.
Google has 90 percent of the U.S. search engine market, while Microsoft’s Bing is a distant rival, with less than 5 percent. According to Google, the difference is explained by the intelligence of its engineers and not the size of its trove of rich data.
To argue its point of view, Google will call on an expert witness, Edward Fox, a computer scientist at Virginia Tech. Professor Fox conducted a “data reduction experiment” on behalf of Google to estimate how much the quality of Google search would decline if it used much less data – roughly the amount Bing has. The result, according to Google’s filing, is that the data difference explains only part of the gap in search quality between Google and Microsoft.
Google’s public messaging on this issue has been consistent over the years. But the government says the message is misleading. In his opening statement, Mr. Dintzer said Google had “misled the public about the importance of data.”
In an attempt to demonstrate this deception, the government last week introduced emails between high-ranking Google employees arguing over the issue as evidence. Hal Varian, Google’s chief economist, was questioned about the flaws and data as the Justice Department’s first witness.
At issue were comments Mr. Varian made in a 2009 interview with the technology news site CNET.
In the article, Mr. Varian said: “The scale arguments are pretty bogus. »
To explain, he adds in the article: “It is not the quantity or quality of the ingredients that makes the difference. These are the recipes. It was a clever analogy, the ingredients being data and the recipes being the clever algorithms written by Google engineers. It reached a wider audience when Mr. Varian’s explanation was featured in a Time magazine article.
But in an email to Mr. Varian shortly afterward, Udi Manber, a senior engineer on Google’s research team, disputed the economist’s description. “It is absolutely false to say that scale is not important,” Mr. Manber wrote. “We make very good use of everything we receive.”
In an email with other Google employees, Mr. Manber wrote: “I know this reads well, but unfortunately it is factually false. »
A lot has changed since then. The government introduced these emails to question the credibility of what Google says in court. They constitute just a few excerpts from the start of a lengthy non-jury trial that will generate piles and piles of evidence, testimony and rebuttals for Judge Mehta to evaluate and consider.
But what is already clear is that the debate over data in research – whether or not it has market-determining power – is a central issue, on which both sides will most likely be forced to return to several times during the trial.