Archive for September, 2011

Fact-Check Follow-Up

September 22nd, 2011 No comments

Some of Senator Lee’s questioning in yesterday’s hearing centred around a study conducted by Foundem in April this year. This study of Google’s US search rankings for hundreds of product- and product-price-comparison-related search terms was a follow-up to Foundem’s earlier study of Google’s UK search results (included in Foundem’s submission to the FCC and in Foundem’s EU Antitrust Complaint filed last year). The graphical output of this study demonstrates the breathtaking extent to which Google’s Universal Search mechanism consistently places Google’s own price comparison service at or near the top of nearly all product- and product-price-comparison related searches.

Foundem’s contention – which is based on Google’s own descriptions of its Universal Search mechanism – is that Google uses different algorithms and relevance signals to rank its own services than it does to rank everyone else’s.  Because Google applies a different standard to its own services than to everyone else’s, Google can systematically favour its own services to whatever extent it chooses.

Many of Mr Schmidt’s answers to Senator Lee’s probing questions on this subject seemed to hinge on the surprising assertion that Mr Schmidt does not consider Google Product Search to be a price comparison service:

“There’s a conflation of two different things going on in this study…there’s a difference between sites that do product comparison and sites that offer products themselves. Google Product Search is about getting you to a product, and so we tend to look for the product as opposed to the product comparison in this particular case. Which is why the product is more highly ranked than the result of a product comparison site. If you did the same study with all of the other product sites you would find a very different result.

…Things like the companies that are mentioned there are price comparison shopping; they are different animals if you will. They are important, but they do different things. Google Product Search is about searching for specific products. In that sense Product Search does something similar to what PriceGrabber, Nextag and Shopper does, which is why the confusion exists. … It’s an apples to oranges comparison.”

Eric Schmidt, September 21 2011

In our earlier blog post we pointed out that this assertion raises an obvious question: namely, if Google Product Search isn’t a price comparison service, why does Google consistently insert this service at or near the top of the vast majority of Google’s price-comparison-related search results?

But more importantly, Google Product Search is a price comparison service. The following screenshot (taken this morning) shows that Google itself describes Google Product Search as a price comparison service (as does Wikipedia and ComScore):

Mr Schmidt also downplayed the anticompetitive impact of Google’s preferential treatment for Google Product Search (and other services) by suggesting that the inserted links were merely links to vendor sites, not to Google’s own service.  But this is not the case.

The following screenshot, for example, shows a Universal Search result for Google Product Search similar to the one featured in the screenshot from yesterday’s hearing.  In this example, and in the one from yesterday’s hearing, all four of the featured links are links to Google’s own Product Search service, not to vendors:

Categories: Foundem Tags:

A Quick Fact-Check on Some of Mr Schmidt’s Testimony Before the Senate Antitrust Sub-Committee

September 21st, 2011 No comments

The Senate Antitrust Sub-Committee used one of Foundem’s scattergram graphs in its hearing earlier today. Senator Lee asked Mr Schmidt a few questions around the data. We believe that Mr Schmidt’s answers may have been misleading in several ways.  For example:

  • Mr Schmidt suggested that the data was comparing "apples to oranges". Mr Schmidt implied that Google Product Search is some kind of "product search", not some kind of price comparison service. This is strange. Most people would consider Google Product Search to be a price comparison service. We wonder what Mr Schmidt would consider to be Google Product Search’s competitors, if not price comparison services?
  • Also, if Google Product Search is not a price comparison service, then it begs the important question: why did Google Product Search show up so consistently at or near the top of Google’s search results for the hundreds of product-price-comparison-related queries shown in Foundem’s graph? Why does Google’s Universal Search mechanism so consistently place Google Product Search at or near the top of most price-comparison-related searches, if Google Product Search is not a price comparison service? For example, hundreds of the data points shown in Foundem’s graph were for queries of the form: "compare prices [MAKE MODEL]" and "best prices [MAKE MODEL]".
  • Mr Schmidt also suggested that if a user clicked on these prominently placed Google Product Search links it would merely take them to a vendor site. This is not true in most cases. In the vast majority of cases a click on these links takes users to Google Product Search – Google’s own ad-supported service – not to a vendor.

The data in the above chart was collected on April 15 2011.  Some examples of the 650 product- and product-price-comparison-related searches illustrated include: “Canon PowerShot S95”, “best prices Canon PowerShot S95”, “compare prices Canon PowerShot S95”, “Canon PowerShot S95 prices”, and so on for a wide variety of products.

For a more complete description of some of Foundem’s analysis and arguments around the anti-competitive power of Google’s Universal Search mechanism, see our comment to the FCC.

And, for our latest thoughts on some of the issues underpinning the current antitrust investigations into Google, please see our recent article, "Penalties, Self-Preferencing, and Panda: Why Google’s Behaviour Makes Antitrust Sanctions Inevitable".

Categories: Foundem Tags: