Kara Swisher

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Google’s Schmidt at Senate Antitrust Hearing: Eric “Gets It!”

Please see this disclosure related to me and Google.

Ready, aim, fire — at Google at the Senate Judiciary Committee’s antitrust subcommittee hearing happening right now in Washington, D.C.

It is titled: “The Power of Google: Serving Consumers or Threatening Competition?”

Here we go:

11:04 am: As usual in D.C., the Senators on the committee get to pontificate first.

Oh, joy! (I used to live there and cover Congress stuff for the Washington Post from time to time and I am having bad déjà vu right now.)

A quick cut to Google Executive Chairman Eric Schmidt, who is appearing alone. He looks a little peaked, especially as the pols begin to describe the scary behemoth the search giant is.

And also that it is trying to force users to its other products.


11:07 am: Sen. Mike Lee, the Republican from Utah, who is a Google critic, is talking on about the search giant’s power, reading from his testimony in a dullish style.

I thought this dude was a Tea Party firebrand!

“The primary focus should be consumer welfare,” he says, blah, blah, blaaaaaaah.

11:09 am: Now, the subcommittee’s dour chairman, Sen. Herb Kohl from Wisconsin, is introing Schmidt, who is actually being introed by California Sen. Dianne Feinstein.

She is an Eric fan, obvi, praising his accomplishments at Google. But she also gives props to Jeffrey Katz, CEO of Nextag, who is testifying against Google later. Also, let her add, is the fabulous CEO of Yelp, Jeremy Stoppelman, another anti-Google speaker to come.

“I hope they tango rather than tangle,” says Feinstein inexplicably about those called to testify. Hey, white geeks can’t dance, although wrestling would also be hard for them too.

In any case, gotta love these everybody-loving pols!

11:14 am: Finally, Schmidt, who — of course — starts off invoking the last big tech giant who was here getting spanked by Congress.

Schmidt does not name Microsoft — classy, by which I mean not at all — but is referring to the software giant.

“We get it,” he says about the lessons Google has learned from Microsoft’s own antitrust troubles back in the day.

11:18 am: Schmidt is talking about Google and saying he welcomes the competition.

“Today it’s Google turn in the spotlight,” he says, still not uttering the word “Microsoft,” much as Microsoft execs have often not been able to say Google. “One company’s past [should] not be another company’s future.”

Now, the senators can have at him. Kohl is up first.

11:20 am: The first question is if Google is favoring its own products, via search.

Schmidt harkens back to what he calls early Google lore that it is just trying hard to get consumers stuff quicker.

The need for speed!

“Is really trusting Google to do the right thing sufficient?,” asks Kohl, who quotes former President Ronald Reagan’s famous line: “Trust but verify.”

That gives Schmidt the chance to talk about how quickly Google could lose out to competitors and then is onto how hard it is to do what Google does.

It takes extra-smart smartypants. Trust us, he says, as we are smartier!

11:24 am: Kohl comes back with a damning quote from Google’s famous Marissa Mayer, who apparently has said that the company favors its own products and why not?

Schmidt says he was not there when she allegedly said this, but that its own testing and intuition tells Google if consumers want a Google map or whatever tout de suite!

Kohl repeats the Mayer quote again: “We do all the work for the search page, so we put [a Google Maps link] in first.”

“I will let Marissa speak for herself,” says Schmidt, now too deep in the weeds of her verbal faux pas. Get out, Eric!

11:28 am: Sen. Lee is up, not taking any of this speedy, we-know-best business.

And he has a chart! I love a good chart. It shows Google info always ranks first in listings versus other sites it competes with.

Schmidt has not seen this poll, but thinks it is not accurate.

11:31 am: Let me note that Schmidt’s grey suit is fantastic looking. And right behind him, you can see Google’s top lawyer, the always nattily dressed David Drummond.

Back to the chart!

Lee wants to know why, according to his chart, that Google seems to come up first.

“Either way, you’ve cooked it,” claims Lee.

“Senator, I can assure you we have not cooked anything,” counters Schmidt.

(Note: Google does have an excellent cafeteria in Silicon Valley, complete with organic arugula and Kombucha for all.)

11:33 am: Hoo boy! But Lee’s time has expired, so Schmidt gets a break in the form of New York’s Sen. Charles Schumer.

I like the way he says “ee-no-vation” for innovation.

He does an expected plug for New York, of course. Somehow it is No. 1 in tech. Not so much, but brag on, Chuck!

11:38 am: Schumer is still talking about New York and its fab entrepreneurs.

Apparently, he has done a lot of jawboning with start-up dudes (likely over Kombucha) and they think Google is a positive force.

“Google is actually pretty good, we don’t see them as rapacious,” Schumer says the New York nerds tell him.

Is “rapacious” the criteria here?

Schumer is running out of time and has yet to ask a question and now is trying to get Schmidt to test Google’s broadband project in the Hudson Valley.

Now that’s rapacious!

Is there going to be an actual question here?

Yes: Oh please tell us, genius boy, what could Google do better?


11:42 am: Now, Sen. John Cornyn from Texas is on and asking about the prescription controversy Google was embroiled in recently.

Oops, I missed a bit when someone called me about the CEO mess at Hewlett-Packard I reported on earlier.

Onto Senator Amy Klobuchar from Minnesota. She is cleverly using an article about the Vikings football team to ask about how Google’s super-secret-sauce algorithm works and how it ranks results.

“Do you think companies should have a lot more certainty in how they are ranked?,” she asks.

11:51 am: Schmidt is not really answering, except to say Google is not perfect.

“We don’t know how to do it with more certainty,” he says, which is odd for a company that is perhaps the most irksomely certain group of geeks ever assembled on the planet.

Klobuchar moves to copyright issues. “There’s a real problem here,” agrees Schmidt.

Yes, and some media companies think Google is the problem and has not done enough to fix the problem.

“It’s difficult,” says Schmidt. Well, isn’t Google smartier?

“We’re under great pressure to resolve this,” he says.

11:55 am: Klobuchar is still worried about the small businesses, but she wants Google to come to Duluth.

Good lord, it’s a shakedown in plain sight. Maybe Google isn’t the scary one here! These pols seem pretty frightening.

Now Iowa Sen. Charles Grassley is saying he will attend some Google event in his state.

Of course!

Grassley makes a wishy-wishy statement, and we get to hear from Iowans on both sides.

Some are apparently concerned that Google is a troublemaker and some aren’t.

Iowans, like a lot of folks, are torn.

“We are happy to be judged,” says Schmidt.

12:00 pm: Now it is time for Sen. Al Franken from Minnesota.

“First let me say, I love Google,” he says.

Otay. I wonder if Franken knows that Google is a giant scary computer.

But, as a citizen of San Francisco, I say he should love whoever he wants!

Franken is also concerned about his love’s behavior and is taken aback by one of Schmidt’s previous answers.

It’s that irksome Marissa Mayer quote again.

When asked if the algo was unbiased, Schmidt apparently was not as sure as shootin’!

Now, it is onto Yelp and the fiery quotes from Stoppelman about how Google nefariously blocks the review site’s content.

Eric “generally” disagrees with Jeremy.

At one point Google tried to buy Yelp, so this is a fraught situation.

Does Franken know about the previous Google-Yelp hookup?


Schmidt says it is Yelp’s fault for asking to be removed from the algo. Actually, Yelp only asked Google to stop jacking its fare.

12:11 pm: Oh noz, another pol? This time Sen. Richard Blumenthal from Connecticut.

He is super-smiley, while calling Google a “behemoth.” I like that word a lot and use it for the company often, although I always like to use a qualifier like “thuggish” or “freaky.”

Back to the blabby Blumenthal, who cannot seem to get out a question.

Wait! He asks if Google can suggest some fixes to “avoid government regulation.”

I. Kid. You. Not.

12:21 pm: Kohl is back and giving Google a little more slap-a-doo.

I like the whole Kohl thang of looking over his glasses down at Schmidt.

He asks: Should we trust Google? Should we?

In my opinion: If your mother says she loves you, you should check it.

So, no!

Schmidt assures him: “We make mistakes.”

Lee is then back, asking if Google gives preference to its own products in search?

Exactly the point and a question that is still not answered properly.

12:24 pm: Lee remains troubled by Schmidt’s testimony.

He uses terms like “leverage its natural dominance” and “significant market share to disadvantage” competitors.

Sounds like, um, Microsoft. And then it is back to that niggling Marissa Mayer quote. (Memo to the voluble exec, who apparently never met a microphone she didn’t want to talk into: You might want to take a day off today at the Googleplex.)

Google-luvin’ Franken is back and he is asking about mobile search.

Where Google is dominant again! (Jellllllo, Al, we in Silicon Valley know that one already!)

He asks if all Android devices come pre-loaded with Google products. Schmidt thinks two-thirds come with it, but handset makers can choose.

12:31 pm: Back to all-smiles Blumenthal, who says he has come to no conclusion.

But lo! He is not as silly as he seems and goes into an interesting racetrack analogy about how Google owns the track and now has horses and now those horses are winning.


Schmidt disagrees, natch!

He thinks the Internet is the platform and Google is the GPS.

Metaphor contest!

I think Google is a big tasty banana cream pie we can’t stop eating, although we know it’s bad for us.

That or an alien wearing an expensive suit who will soon eat us all.

Franken comes in with a doping horses joke. Remember when he was funny on “Saturday Night Live”?

Me neither.

It goes on without a lot of really good discussion. Klobuchar asks something, but I forget it immediately. My bad!

She has a last question about advertisers and privacy. Softball!

Let me write this for Schmidt before he inevitably spits it out: Of course, Google wants to protect privacy.

12:37 pm: Finally, the second panel of critics. Sadly, I must go to an appointment in Silicon Valley to visit one of its rapacious companies.

Oops, I meant ee-no-vative.

But, no worries, John Paczkowski will take over from here once it gets going again after the break.

12:47 pm: The panel’s back in session. The first critic to take a shot at Google, Thomas Barnett, a lawyer for Expedia.

12:51 pm: Riffing on Schmidt’s earlier “We know, we get it” comment, Barnett argues the opposite.

“Google doesn’t get it,” he says, adding that the company’s ever-expanding market power is troubling.

12:54 pm: Google is a monopoly, Barnett continues, and it has a duty not to abuse that position. He concludes by saying antitrust enforcement can and should play a role in maintaining competition in the markets in which it does business.

12:57 pm: Moving on now to Nextag CEO Katz, who has some tough words for the search giant. “Today Google doesn’t play fair,” he says.

He argues that Google rigs its results to drive consumers to Google Product Search when they search for information to inform their purchases.

1:00 pm: Next: Stoppelman of Yelp, who wonders if it’s even possible to create a company like Yelp today because of Google’s massive market power.

1:04 pm: Google’s outside lawyer, Susan Creighton, takes the mic next. Having trouble with the video stream from the Senate, but as best I can tell she talked broadly about the competitive landscape and reiterated Schmidt’s “competition is just a click away” narrative.

1:08 pm: She concludes by saying government oversight of Google’s search results rankings would put the company at a disadvantage and turn its search service into something akin to a “regulated utility.”

1:09 pm: Interesting. Creighton says she doesn’t believe Google has monopoly power.

1:10 pm: “Each of you right now can test whether or not you like Google’s search results and if you don’t like them it’s free and instantaneous to try someone else.”

1:22 pm: Apologies, the Senate video feed has gone from bad to worse.

1:23 pm: Franken asks Yelp’s Stoppelman and Nextag’s Katz if they could start their companies today given Google’s market power.

Both say that’s unlikely.

1:26 pm: Terse exchange between Franken and Creighton about whether Google paid Apple to be the default search engine on its iOS devices. Lots of back and forth, but Creighton finally concedes that there’s some sort of financial deal between the two companies.

1:39 pm: Sen. Lee asks what Google might do to “level the playing field.” Stoppelman suggests separating search from its other properties. Pipe dream.

1:40 pm: Well, it looks like it may be getting near the end of the session, which is a good thing because we get it to by now.

And that is: Nothing significant is going to get said here.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik