September 22, 2011
UPDATE: Google’s Schmidt Defends Himself Boldly Against Senate Hearing
Google Inc.'s Executive Chairman Eric Schmidt faced off in a U.S. Senate hearing on Wednesday and claimed the company had not altered its search results in favor of itself over competition.
Members of the Senate Judiciary Committee's antitrust panel said the company had grown into a dominant and potentially anti-competitive force on the Internet.
"Google is in a position to determine who will succeed and who will fail on the Internet," Republican Senator Mike Lee said during the hearing. "In the words of the head of the Google's search ranking team, Google is the biggest kingmaker on Earth."
Rival companies have accused Google of using its dominance in the search market to try and have an edge.
Lee asked Schmidt questions over whether Google deviates from its search algorithm to help try and boost itself over competition.
He said that search rankings for price comparison sites like Nextag and Pricegrabber varied while Google's shopping sites always ranked third.
"I see you magically coming up third every time," Lee said. "I don't know whether you call this a separate algorithm or whether you've reverse engineered one algorithm, but either way you've cooked it, so that you're always third."
Schmidt replied with, "Senator, may I simply say that I can assure you we've not cooked anything."
Jeffrey Katz, the CEO of Nextag, an Internet comparison shopping company, said Google was initially a huge help in building innovation.
"But what Google engineering giveth, Google marketing taketh away," he said in written testimony.
He said the company is now the Internet neighborhood bully and it "doesn't play fair."
"As a result, Nextag's access is more and more discriminated against ... because we compete with Google where it matters most, for very lucrative shopping users."
During his argument, Schmidt referred to the late 1990s Microsoft investigation without directly saying the name Microsoft out loud.
"That company lost sight of what mattered and Washington stepped in," Schmidt said. He continued to say Google has learned the lessons of that antitrust case against Microsoft that concluded in 2001. "We get it," he said.
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