Google To Face The Senate

Google Inc. is taking no chances as its executive chairman,Eric Schmidt, prepares to face a Senate hearing Wednesday on whether the company is abusing its dominance in Internet search. Google's Eric Schmidt, the online search giant's point man for all things Washington, goes before a Senate panel this week to argue the company is not a rival-abusing bully, but in fact is struggling to stay on top. Google Inc controls more than two-thirds of the global search market. But Web technologies such as social networking and smartphone applications offer new ways for people to find information putting pressure on the company.

The state of the case

The hearing carries risk for Google because the panel is looking at its most important product search, says Colin Gillis, an analyst at BGC Financial in New York."It's never a positive to have to testify on antitrust on the Hill," said Gillis. "The best-case scenario is that things continue as they are."Gillis added there was an outside chance Schmidt would make a damaging mistake.

"He's opening his mouth and he's speaking and there's always the possibility that something will come out of it that he thinks is logical and that the committee may not like," he said. "It's not likely to happen, but it's always possible."Schmidt could also discuss other factors that can bring down a website's ranking, such as whether there are errors on the site, like broken links; the speed of the site and whether the site appears to have malware.











Google says it is reaching out to webmasters, letting them know about problems that could affect their search ranking.Schmidt has been defending Google in Washington for years and is well aware many antitrust experts are skeptical that Google always plays fair.Democratic Senator Herb Kohl, head of the Senate Judiciary Committee's antitrust panel, is one of several lawmakers expected to press Google on the issue of search.

Senator Richard Blumenthal, a Democrat who led investigations of Google when he was the Connecticut attorney general, called Google a "great American success story," but says he will have questions.


"Concerns have been raised by both regulators and competitors over whether Google has used its dominance of the online and smartphone search markets to impose extra costs on consumers, unfairly preference its own products, or disadvantage competitors through a variety of means, including its search and advertising systems," Blumenthal said in a statement to Reuters.

Republican Senator Mike Lee, who is also on the subcommittee, has expressed concern about Google's purchase of ITA travel search software. Competitors such as Expedia Inc have worried Google would abuse its new dominance in travel search.
Executives representing Expedia as well as Yelp, another Google rival, will testify at the hearing after Schmidt.