Inside Google

Has Google taken a page from Microsoft’s evil history and started using the same anticompetitive tactics that landed the Redmond, WA., software company in antitrust trouble in the U.S. and Europe? A exclusive report in The New York Post says that’s exactly what the Federal Trade Commission is considering in its major antitrust investigation of the Internet giant.

Remember what got Microsoft into trouble? It was bundling its browser, Internet Explorer, with its operating system and leaning on PC manufacturers to use it, thus giving Microsoft an unfair and illegal advantage over competitors like Netscape.

That tactic apparently is a key element of the FTC probe, according to the Post’s Josh Koshman, who has a good record of breaking stories about antitrust investigations. He reports:

“Federal antitrust investigators, nearly four months into a wide-ranging probe of Google, appear to be focusing on whether the search giant is pressuring handset makers to pre-load phones with Google applications, The Post has learned.

“That is, they are peppering the company’s legal eagles with questions about relationships with Android handset makers and whether Google pressures those companies to make the search company’s properties — like Gmail, Google Maps and Google search — the default settings on the phones, people close to the matter said.”

Google executives have repeatedly emphasized how important the mobile market is to the company. Its Android operating system, the latest version dubbed “Ice Cream Sandwich,” is now on 43 percent of U.S. smartphones. Apple’s iPhone has 28 percent of the market.

Kosman reports the FTC is less interested — at least for now — in concerns that

Google uses its dominance of search to favor its own products. Google controls 65 percent of search online in U.S. market and 95 percent of mobile search. A Consumer Watchdog study demonstrated how with the Google’s properties, such as Google Maps, benefited from the implementation of “Universal Search.”
Kosh predicts that the FTC will narrow its focus by the end of the year and conclude the investigation by mid-2012.

Meanwhile, Google could face other concerns about its Android operating system. The late Apple CEO Steve Jobs apparently thought it was a complete rip-off of his company’s iPhone. In his just released biography of the iconic CEO, Walter Isaacson reveals the depth of Jobs animosity. AP reporter Mike Liedtke puts it this way:

“It’s clear that the perceived theft represented an unforgivable act of betrayal to Jobs, who had been a mentor to Google co-founders Larry Page and Sergey Brin and had welcomed Google’s CEO at the time, Eric Schmidt, to be on Apple’s board.

“Jobs retaliated with a profane manifesto during a 2010 conversation with his chosen biographer. Isaacson wrote that he never saw Jobs angrier in any of their conversations, which covered a wide variety of emotional topics during a two-year period.

“After equating Android to ‘grand theft’ of the iPhone, Jobs lobbed a series of grenades that may blow a hole in Google’s image as an innovative company on a crusade to make the world a better place.

“‘I will spend my last dying breath if I need to, and I will spend every penny of Apple’s $40 billion in the bank, to right this wrong,’ Jobs told Isaacson. ‘I’m going to destroy Android because it’s a stolen product. I’m willing to go to thermonuclear war on this. They are scared to death because they know they are guilty.'”

With the antitrust challenges from the FTC and the possibility of Apple taking real action on Jobs’ outrage Google CEO Larry Page and other executives in the Googleplex face some interesting times in the next few months. And by the way, when the Chinese say, “May you live in interesting times,” they mean it as a curse.