Lawmakers Blister Google Chief Over Competitive Issues
Policy + Politics

Lawmakers Blister Google Chief Over Competitive Issues

Google’s executive chairman, Eric Schmidt, faced a barrage of questions from lawmakers Wednesday about whether his company’s search engine stifles competition as he insisted it has not violated its famous “don’t be evil” motto.

Schmidt, who had never testified on Capitol Hill, began his highly anticipated testimony by invoking the memory of Microsoft’s Bill Gates, who walked the same gantlet before the Senate Judiciary Committee’s antitrust panel during the 1990s.

“That company lost sight of what mattered and Washington stepped in,” said Schmidt, who worked at companies that competed with Microsoft at the time. “I’m here carrying a long history. . . . We get it.”

The hearing was held as Google has come under investigation by antitrust officials in the United States, Europe and Asia. The probes have centered on whether the company’s dominance hurts consumers.

Sen. Mike Lee (R-Utah) pulled up a giant chart showing the company’s rankings of its own shopping search results compared with other sites. Lee said Google’s services tended to appear higher in its results pages.

“You’ve cooked it!” said Lee during the hearing’s testiest exchange.

Schmidt responded, “I can assure you we haven’t cooked anything.”

Schmidt insisted that Google’s business was focused on serving consumers and that over time, the company had expanded its business from delivering relevant links to users to giving them answers more quickly. For instance, the search giant will put a map from its own service at the top of a search results page if the user is looking for an address.

He even said that Google does not always act like a “rational” business that tries to maximize profits. “One of the most important principles is: Solve the problem the consumer has,” he said.

And in a nod to the country’s unemployment crisis, Schmidt took care to mention that Google employs thousands of people in the United States. He said the company had announced that 2011 would be its biggest hiring year yet.

Various senators declared they were fans of Google’s products, even while they had reservations about Google’s dominance. “I first want to say I love Google,” said Sen. Al Franken (D-Minn.).

Sen. Charles E. Schumer (D-N.Y.) even lobbied Schmidt to invest in his state, followed by Sen. Amy Klobuchar (D-Minn.), who made a similar pitch.

When asked whether Google had become a monopoly, Schmidt said, “We’re in that area,” though he later denied the company was “a monopolist.”

The company’s critics argued Wednesday that with Google giving less space to competitors in its search results, and with the company being the Internet’s de facto gatekeeper, smaller companies have trouble winning users — and consumers suffer by having fewer choices.

After Schmidt testified, some of Google’s competitors said they would not have launched their companies today given Google’s dominance on the Internet.

“I would find something else to do,” said Jeremy Stoppelman, co-founder and chief executive of the user review Web site Yelp.