Why Google is not anything like Intel

The European Union's $1.45 billion fine of Intel has led some pundits to expect Google is the next tech giant in line to face the regulators' wrath. But most seem to gloss over one key issue. Google first has to engage in unlawful, unfair competitive practices before the EU can justify doing anything. And so far, Google's failed to provide the ammunition.

While U.S. regulators continue to leave no stone unturned in their zeal to catch Google at something unseemly, the best they've come up with so far is a book search deal that had already been settled and the fact that Google's CEO Eric Schmidt also sits on Apple's board. Both issues are blatantly public and Google's team of lawyers is probably well-armed to defend them. After all, the interested parties in the book search deal agreed to the terms, one of which is that Google would shell out $125 million to build a copyright holders registry and compensate copyright holders, who also get to share in any proceeds going further. As for the board tussle, Schmidt says he sees no conflict, but should the FTC disagree, the remedy is that he simply steps down from Apple's board. No harm, no foul. And no humungous fine.

Now compare that with Intel. Not only did the chip giant make secret payments, or kickbacks, to computer makers who agreed to use its chips. It also coerced computer makers using AMD chips to cancel or delay the launch of those machines, while supplying large customers like governments and universities with below-cost server chips in an effort to squeeze AMD out of the market.

How is that like Google? Does Google pay companies to use its search engine? No. (Actually, that's Microsoft.) Does Google stifle competition in search? Well, so far, it seems to welcome the competition and then quickly decimate them with new features that make their products obsolete before they're out of the gate. While not very nice, such practice is (at least not to date) illegal and unfair.

Google is just successful, and in this economy, that makes it the biggest target around right now. And while some argue whether or not it's a monopoly, perhaps the truth is that it's a lawful monopoly. Like James Stewart of the Wall St. Journal posited last week:

Google is that rare breed: the natural monopoly. By natural, I also mean lawful, since the monopoly derives from Google's skill and qualities inherent in the business, not from anticompetitive behavior.

And that means Google really is not anything like Intel. At least not so far.

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