Google, Death Wish in Tow, Tells Feds: Take Your Best Shot
Google's (GOOG) apparent death wish is mystifying. On one hand, the company wants Congress and the Obama administration to pass a tax holiday so it can repatriate some of the $17 billion is has sitting offshore. And yet, a Senate subcommittee is threatening to subpoena chairman Eric Schmidt and CEO Larry Page while the FCC may also serve subpoenas, all in antitrust matters.
No company can always avoid clashes with regulators or lawmakers. And sometimes Google is a target because of its own success. But too often, its top managers are so antagonistic to regulators and legislators that you wonder if someone pasted "kick me" signs on their backs. It's self-destructive and, even worse, eminently avoidable.
The bigger they are ...
Google's dominance of the search industry and the advertising revenues that result is spectacular. Even with Microsoft (MSFT) breaking 30 percent U.S. search share, that still leaves Google far ahead of everyone else.
When you have that type of market share, competitors use everything at hand to slow you down. Maybe complaints that Google is stacking the search deck are justified, as my BNET colleague Jim Edwards argues. Or maybe they're not, because Google is essentially a publisher with complex algorithms -- and some manual intervention -- to get its results to reflect a given philosophy. As I've shown before, Google's competitors often get a better position than the company's own offerings in a given category. Is it literally supposed to rank itself last on principle?
However, from a management view, whether charges are fair or not doesn't matter. They will come and you have to deal with them. Only, Google's reaction is increasingly to just ignore authorities. Last fall, for instance, it refused to cooperate with the Connecticut Attorney General over a privacy investigation.
Sorry, we're busy that day
And yesterday, Google refused to send Schmidt or Page to a Senate Judiciary antitrust hearing, even though committee Chairman Herb Kohl and ranking minority member Mike Lee wrote, "We would very much prefer to work this out by agreement rather than needing to resort to more formal procedures." More formal is not-too-subtle code for, "We can always send you a subpoena."
That one could join the subpoenas that the FTC is supposedly sending on the same topic. For that matter, why not forget about cooperating with European regulators and have them start a legal process as well?
The arrogance of simply ignoring such a request is startling. What does Google think will happen as a result? Are its executives hankering for an opportunity to plead the Fifth when questioned? Hasn't anyone there learned from what antitrust probes did to IBM, Microsoft, and Intel (INTC)? Irritated people in power can do a lot of damage to a company.
Related:
- 3 Reasons Larry Page Needs a COO, and 1 Reason He Won't Get One
- EU's Google Probe Spells Danger for Internet Companies
- In Google Versus Apple, the FTC Makes Microsoft a Clear Winner
- Google, in Regulatory Crosshairs, Tells Enforcers to Talk to the Hand
- Bing Gains on Google, Breaks 30% U.S. Search Share
Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.
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