No. of Recommendations: 23
Just now a federal judge forced a ruling that allows Google to keep its Chrome browser but as all the news are now reporting "barred from exclusive contracts and must share search data".
Google avoids the more severe penalty - being forced to sell off its Chrome browser - which a lot of pundits were expecting. The stock is trading up 8% in after hours but the above line that is running in the news "barred from exclusive contracts and must share search data" is pretty vague, so I'll expand it as I understand it.
"Barred from exclusive contracts": This gets to the core of the lawsuit's allegations. Google has long paid massive sums of money (such as $20 billion a year!) to companies like Apple and various Android device manufacturers to make Google the default search engine on their devices and browsers. These deals were "exclusive" meaning Google was the only search provider they would enter such a contract with. The ruling essentially bans this practice (and critically - as I understand they are banning it for all search engines and not just banning it for Google - read my last paragraph for the consequence).
"Must share search data": Search engines can be more targeted (and thus have much higher auction rates) by analyzing user queries and clicks to gather info. Google's dominance has given it a huge advantage because of the vast amount of data it collects. The ruling requires Google to share a portion of this data with its rivals. This will help competitors, especially newer, AI-driven search engines, improve their own algorithms and results to better compete with Google. But this one is really vague to me and it would be really hard to define what sort of data Google needs to share, so this could drag on for years and get no-where.
The important question in my mind is whether another search engine is able to pay Apple to force them to be the default choice. The ruling bars exclusive contracts, but not all contracts. This means that another search engine owner, like Microsoft's Bing or DuckDuckGo, could potentially pay Apple to be one of the default search options, but - as I understand it - Apple would have to be open to offering multiple search engines as a default choice, or a non-exclusive deal. If I'm interpreting this correctly, then it has extremely low impact on Google, as if faced with a choice of search engines that the user is forced to select between, similar as you do that when setting up Gmail vs Hotmail, then most users will anyway select Google as the default.
This is very good news for Google, though the news came out just a few minutes ago so I'm extrapolating from very little info.
- Manlobbi
