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Posted at 04:44 PM ET, 09/21/2011

Google’s Eric Schmidt defends the company’s search practices


Google executive chairman Eric Schmidt testified during a Senate hearing on Wednesday. (J. Scott Applewhite - AP)
Google chairman Eric Schmidt defended the company’s business practices before a panel of senators Wednesday as the lawmakers lobbed questions on search rankings and Google’s search algorithm.

It was the executive’s first time speaking on the Hill, as Google has drawn scrutiny from antitrust officials who are investigating whether the search engine giant is abusing its power.In particular, questions are being raised about whether Google has, in effect, a monopoly in the search market.

During the hearing before the Senate Judiciary antitrust subcommittee, Schmidt stressed that Google will cooperate with the Federal Trade Commission, which is investigating the company’s practices. He said that everything the company has done so far is legal and good for its customers.

Invoking Microsoft’s antitrust battles at the start of his testimony, Schmidt said that Google understands the reasons why its practices are now under the microscope.

“We get it.” he said, “We get the lessons of our corporate predecessors.”

But some lawmakers were skeptical and fired questions at the tech titan, asking whether Google gives preferential treatment to its own products.

Sen. Richard Blumenthal (D-Conn.), who has battled Google in the past as a state attorney general, summed it up this way: “First you ran the racetrack, then you owned the racetrack. You own the horses now, and your horses are winning.”

Schmidt responded that the Internet is a platform and that Google is like a GPS system and doesn’t control access to the Web.

The company does, however, control its own search rankings, which were a key issue in the hearing. Sen. Mike Lee (R-Utah) questioned whether the company was “cooking the results” to ensure that Google-related results appeared consistently in product searches.

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

When asked why certain Google products appear above search result lists — for example, stock quotes, driving directions or flight searches — Schmidt said that Google is growing its business to provide customers answers rather than just links in response to search queries.

Schmidt painted a picture of a competitive technology industry where Google faces threats from other search engines, as well as from social network Facebook. He said that Google could do more to help small businesses by investing in those platforms, but he was firm in his assertion that the company’s practices are good for competition.

Yet even as some senators praised the company’s role as a job creator and innovator, they raised concerns about its expansion.

“Google’s growth and success is another reason why we need to pay attention to what you’re doing,” said Sen. Al Franken (D-Minn.), who expressed frustration when Schmidt did not directly answer whether Google’s rankings used an unbiased algorithm when providing search results.

Schmidt said that he believed they do, but that did not satisfy Franken.

“If you don’t know, who does?” the senator asked. He also said that he distrusts companies that control both information and its distribution channels because of the impact those companies could have on innovation.

Lee said that some of his fears about the company had been confirmed by the hearing and that he hopes Google will take “swift action to resolve these concerns.”

By  |  04:44 PM ET, 09/21/2011

Tags:  Google, Antitrust

 
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