Murdoch’s News Corp. goes after Google’s “platform for piracy” and “cynical management”

Rupert Murdoch has popped up again to try to get Google hamstrung by the European Commission. In a vitriolic letter to competition commissioner, Joaquin Almunia, the ‘Dirty Digger’, - through his loyal chief executive at News Corp, Robert Thomson - rails against Google and its methods and ethos with the precision of one who knows what they’re talking about (takes one to know one, a cynic might say). All from the organisation that presided over a long-standing policy of phone-hacking and intimidation….   

According to Thomson “the shining vision of Google’s founders has been replaced by a cynical management, which offers advertisers impressively precise data about users and content usage, but has been a platform for piracy and the spread of malicious networks, all while driving more traffic and online advertising dollars to Google.”  So News Corp isn’t against idealism and innovation. It’s reporting on an Animal Farm scenario where good intentions have lost out to power and money. The pigs are standing on their hind legs.

And they probably are.

This latest Google/News Corp spat is in the wake of an Almunia observation that the concessions proposed by Google to meet concerns voiced by the commission over Google’s conduct and business models, weren’t enough to stave off legal action. In particular: that Google is into gerrymandering its ‘search’ to favour its own services (like YouTube); that it routinely copies content from rivals;  makes it difficult to move ads between platforms and places restrictions on its rivals advertising.

There are some substantive points: Thomson says that Google benefits “significantly from the efforts and investments of others… [and]… must do more to ensure that rights are respected and that its powerful search platform is not abused to eliminate competition.”

Specifically:

• "Sudden changes are made to the ranking and display of Google search results, which inevitably maximise income for Google and yet punish small companies that have become dependent on Google for their livelihood.”
• "In recent months, Google has developed a “certification” process for Android-related products which allows it to delay or deny content companies and other businesses access to the mobile operating system, while giving itself the freedom to develop competing products. This development reflects the exponential evolution of Google from a company that is “open” to one that is selectively closed and willing to exploit its dominant market position to stifle competition."

Newspapers in Europe are suffering, says Thomson, because Google has commodified their content.

• “The uniqueness of news sites has been undermined by aggregation of content which transfers the front page to the Google home page. Readers have been socialized into accepting this egregious aggregation as the norm. The second phase of aggregation is that of the audience. By tracking readers and exploiting its dominance in online advertising, Google is commodifying the audience of specialist publishers and limiting their ability to generate advertising revenue. Data aggregators attempt to sell audiences at a steep discount to the original source, for example, access to 75 per cent of The Wall Street Journal demographic at 25 per cent of the price, thus undermining the business model of the content creator.”

There’s no doubt that news and content is like any other commodity and online competition tends to reduce the prices customers actually pay. Similarly, the tendency is for the dynamics of the Internet itself to atomise the content - mostly because this is how readers prefer to choose and consume it. News Corp’s plea for protection for its business model is unlikely to cut much ice with Almunia who has been dismissive of telcos attempts to do similar. But Google’s manipulation of search is certainly a very live issue and we’ll probably hear much more of it.