Has Google Reached a Turning Point?


New Google CEO Larry Page has reorganized management in an effort to restore the sense of urgency and innovation that was once the company's calling card. But Google might have reached a turning point, with or without any efforts it might make to reclaim a "small company" culture. Google now seems to have grown large enough that it will henceforth have to weigh the potential impact of regulatory action whenever it considers a major new acquisition. In that sense, Google's ability to operate as an unregulated provider of applications might be a thing of the past.  

As Microsoft before found it had to routinely deal with regulatory oversight, and AT&T and other big telecom firms long have had to do, Google now might have passed the point where it could avoid significant government intrusion or oversight of its business operations. 

The immediate issue is antitrust review of Google's planned purchase of ITA Software, a leading provider of flight data. That deal has been under review since 2010 and there are reports that U.S. officials are close to convincing Google to accept some kind of government oversight in order to get approval for its takeover of ITA Software.

The deal reportedly would be allowed if Google gives federal regulators authority to monitor a part of its operations, to assure that the company doesn't unfairly use its control of ITA's airline data to put rivals at a disadvantage. Executives at AT&T and Microsoft know the drill.

Microsoft, Sabre Holdings and Expedia have opposed the move, which they believe will gift Google another effective monopoly. ITA Software is used by most airlines and rival flight search sites worry that Google's lack of transparency would stifle innovation in the market, they claim. Critics say Google’s takeover could make it impossible for travel websites such as Kayak.com and Hotwire to access ITA’s flight data. That likely is less an issue than fears that Google also could promote its own travel listings above those of its rivals

At least in part, Groupon is said to have turned down a takeover offer from Google because Groupon executives did not want to endure a prolonged antitrust review.

Microsoft also has made a formal complaint against Google to the European Commission accusing the search and advertising giant of using various illegal methods to dominate the European search market. That would be the same EC that has in the past investigated Microsoft for alleged monopolistic practices.  

New CEO Page arguably is right to worry about whether Google has gotten too big, too bureaucratic, too slow and unfocused. But Google appears to have reached a stage of its development where it now will not be free to move as it likes, in any case. From this point forward, one might argue, Google will not be able to ponder major growth moves without taking regulatory consequences or opposition into account. 

Oddly enough, even as new CEO page tries to streamline Google and allow it to move faster, the regulatory threshold has gotten higher, essentially forcing Google to evaluate not only what it should do, but whether it will be allowed to do what it proposes. 

Over the last decade, telecom executives often have worried about how firms such as Google would affect the telecom business and its own prospects for growth. Many have talked about the need to move "at Google speed." It now is starting to appear that Google has reached a natural point beyond which it must move more slowly, for external reasons. 

That suggests telco executives might have to start worrying about some other new entity in the market, at some point relatively soon. Google has caused lots of disruption in many markets. But it isn't clear regulators will allow Google to disrupt at will, in the future. If major disruption is to occur, it will in the future not come from Google, but from some smaller firm whose role is not even recognized. 

Gary Kim is a contributing editor for TechZone360. To read more of Gary’s articles, please visit his columnist page.

Edited by Janice McDuffee

Contributing Editor

Related Articles

Coding and Invention Made Fun

By: Special Guest    10/12/2018

SAM is a series of kits that integrates hardware and software with the Internet. Combining wireless building blocks composed of sensors and actors con…

Read More

Facebook Marketplace Now Leverages AI

By: Paula Bernier    10/3/2018

Artificial intelligence is changing the way businesses interact with customers. Facebook's announcement this week is just another example of how this …

Read More

Oct. 17 Webinar to Address Apache Spark Benefits, Tools

By: Paula Bernier    10/2/2018

In the upcoming webinar "Apache Spark: The New Enterprise Backbone for ETL, Batch and Real-time Streaming," industry experts will offer details on clo…

Read More

It's Black and White: Cybercriminals Are Spending 10x More Than Enterprises to Control, Disrupt and Steal

By: Cynthia S. Artin    9/26/2018

In a stunning new report by Carbon Black, "Hacking, Escalating Attacks and The Role of Threat Hunting" the company revealed that 92% of UK companies s…

Read More

6 Challenges of 5G, and the 9 Pillars of Assurance Strategy

By: Special Guest    9/17/2018

To make 5G possible, everything will change. The 5G network will involve new antennas and chipsets, new architectures, new KPIs, new vendors, cloud di…

Read More