Study Claims Google is Violating Competition Laws

Violating Competition Laws

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Researchers from two U.S. universities say Google is skewing search results to favor its own services, thereby harming Internet users and violating competition laws.

Michael Luca of Harvard Business School and Tim Wu of Columbia Law School combined statistical testing with detailed legal and economic analysis to examine the impact of Google’s manipulation of search results to promote the mega-company’s own search services.

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The team found that users were 45 percent more likely to click on results that were ranked purely by relevance. That’s opposed to the way Google ranks them now — with its own services displayed conspicuously, according to Wall Street Journal.

The study was sponsored by Yelp, which has filed a complaint with European Union (EU) antitrust authorities over Google’s search practices. The crowd-sourced review service presented the findings to EU regulators late last month.

In the study, entitled “Is Google Degrading Search? Consumer Harm from Universal Search,” the authors write:

“This suggests that by leveraging dominance in search to promote its internal content, Google is
reducing social welfare — leaving consumers with lower quality results and worse matches.”

The study continues, the results provide “empirical evidence” that, in some cases, consumers were harmed by Google’s search practices, which “cannot be described as pro-competitive.”

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In April, EU antitrust chief Margrethe Vestager formally charged Google with skewing results in its own favor in its comparison-shopping service.

The Wall Street Journal reported that more than 90 percent of Internet searches in Europe are conducted on Google.

Some attorneys say that Google may be breaking the law by promoting its own services while demoting others.

Google flatly denies that it favors its own services in its search results. The company says it helps users by prioritizing its own specialized search services for areas such as maps and travel, simply because it more precisely answers users’ queries.

The study’s authors agree that may be true in some cases, but argue the practices actually make the overall product worse for users by highlighting Google’s own content above others’.

Luca and Wu also found that 32 percent of users would click on Google’s current local results. Forty-seven percent clicked on the alternative merit-based results.

The authors write that the nearly 50-percent increase in the click rate is “immense in the modern Web industry.”

The study continues:

“Stated simply, when it comes to local search, Google is presenting its users with a degraded version of its search engine.”

Google Headquarters, California Photo via Shutterstock

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Julie Fidler Julie Fidler is the author of Adventures in Holy Matrimony: For Better or the Absolute Worst and is a legal blogger for a large national law firm. She resides in Pennsylvania with her husband two very spoiled cats. Find out more at her personal blog.

2 Reactions
  1. Did the time come for Google to be moderated? I don’t know if it can happen. The giant is generally in charge of more than 50% of the Internet. They had that much power.

  2. Many people have speculated this for a long time. I’m just surprised that Google is going to get caught. Good work researchers! Keep ’em honest.