Obama Appoints Google to Microsoft Post
If Google thought CEO Eric Schmidt’s role as an informal adviser to Barack Obama or the inaugural gala it hosted for the new president in January might curry favor with his administration, it was wrong. Certainly, Obama’s choice of Christine A. Varney as head of the Justice Department’s antitrust division suggests the administration may already be concerned with Google’s (GOOG) domineering presence in the market for Internet search advertising.
During a June 19 panel discussion sponsored by the American Antitrust Institute (audio), Varney was particularly vocal in voicing her concerns about the power the company wields in Internet search advertising, which she views as a relevant antitrust market. “If any of my colleagues or friends from Google, or who represent Google, are here, I invite you to jump up and scream and yell at me,” she said. “For me, Microsoft is so last century. They are not the problem. I think we’re going to continue to see a problem, potentially, with Google.”
Varney was quick to note that she feels Google’s monopoly is unsurprising–something it has acquired legally through some remarkable innovation in the market it now dominates. But she said it still demands antitrust scrutiny. “I do not think [Google has] done anything other than be a spectacular, innovative company,” Varney explained. “I’m deeply troubled by their acquisition of DoubleClick, and I’m deeply troubled by their deal with Yahoo. I submit to you that this administration, although they may open a investigation or a review of the Google-Yahoo deal, will do nothing. I think this is a classic area to explore, how do you apply Section 2 in a highly innovative, highly networked, not terribly competitive environment.”
A good question. And one that Varney will apparently answer sometime during the next four years. Best keep that informal “don’t be evil” motto top of mind for the foreseeable future, Google.