Thursday, March 15, 2012

Is FTC out of job? or out of mind?

That is only explanation of their inquiries into Google and Apple.. Come on guys.. It is free world. You are free to use Microsoft's Ding or Bing whatever it is.. or there are tens of other copies of iPad or tablets in the market to chose from. It is customer's choice, whatever they want to buy or not to buy. Nobody is forcing them to buy Apple products or use only Google Search engines. People buy or use them because they feel that it is best value for their money.

FTC is funded by tax payer's money and their job is to save money for taxpayers. These type of acts are simply adding cost to these products and hence increasing prices for the things for customers. Somethings should be left to customers to decide. There are enough alternatives available and users have full freedom to choose from them.

Even if Google messes with search results to increase value of their own pages or Google+, let them do.. it is their search engine and they have full right to tweak logic of it in whichever way they want. If they are stupid enough to tweak results for minor momentary gains, they will loose user's confidence and loose users for good. There are already enough search engines available in market and if market needs more, silicon valley will create more Googles in matter of days or months at them most. Let users and customers decide what is more important for them.

Apple uses Google as their default search engine as it is best in market. Despite Google being competitor of Apple in same category or market segment. This is open/shut case. I think both Google and Apple should sue FTC and not only recover their legal costs to them but more importantly request court to fire the FTC official responsible for these cases or inquiries.

Here is detailed news coverage from our local Mercury News:


Apple drawn into FTC inquiry

Computer maker that uses Google as default mobile search engine subpoenaed in antitrust probe


By Sara Forden and Jeff Bliss


Bloomberg News


The U.S. Federal Trade Commission subpoenaed Apple as part of its antitrust probe of Google, seeking information on how the computer maker incorporates the search engine on the iPhone and iPad, two people familiar with the matter said.

The agency’s request for documents includes the agreements that made Google the preferred search engine on Apple’s mobile devices, said the people, who weren’t authorized to speak publicly and declined to be identified. Google rivals such as Microsoft have criticized these agreements as anticompetitive.

The subpoena indicates the FTC is intensifying its scrutiny of Google’s business practices.

Details of the Apple-Google relationship may show whether Google is abusing its dominance of Internet search to boost revenue in the mobile phone advertising market, said Allen Grunes, an antitrust lawyer at Brownstein Hyatt Farber Schreck LLP in Washington. 
“As mobile search gets more widespread, the default setting becomes more significant,” said Grunes, who doesn’t represent Google or its rivals. 

The FTC has sent subpoenas to other handset makers and wireless carriers, said one of the people, who declined to name the companies. 

In its broader antitrust investigation of Mountain View-based Google that began about a year ago, the FTC is examining whether the company unfairly increases advertising rates for competitors and ranks search results to favor its own businesses, such as its social-networking site Google+, two people familiar with the situation said in January. 

Google has been the default search engine for the iPhone since Apple introduced the device in 2007 and on the iPad since its 2010 debut, as well as for the iPod Touch. Apple also uses Google Maps as a favored service on the iPhone and iPad. 

The FTC’s probe of Google is also looking at whether the company is using its control of the Android mobile operating system to harm competition, two people familiar with the probe said last year. Apple and Google have been vying for leadership in the smartphone market since the first Android-based handset came out in 2008. 

“It’s very likely in the next few years, we’ll see mobile search outstripping desktop search,” said Ben Schachter, a New York-based analyst with Macquarie Capital who has a buy rating on Google stock. Schachter estimated that by the end of the year, 25 percent to 30 percent of searches would take place on mobile devices, up from about 15 percent currently. 

Schachter said consumers usually leave the default settings on smart phones or other mobile devices. 

“Most people don’t even know what default search means — they just know there’s a box they can use to look for information,” Schacter said. 

Google’s Android became the dominant mobile phone operating system last year and led the market with a 50.9 percent share in the fourth quarter of 2011, compared with the iPhone’s iOS mobile operating system’s 23.8 percent share, according to a February report by Gartner, a Stamford, Conn. researcher. 

Kristin Huguet, a spokeswoman for Apple, Cecelia Prewett of the FTC and Adam Kovacevich, a Google spokesman, declined to comment on the subpoenas. 

Google last year earned $1.3 billion in search-related revenue on Apple products, according to a March 8 report from Macquarie Capital. Google paid Apple $1 billion to be the default search engine, keeping only $335 million of the total amount, the report said. 

In January, eMarketer, a New York-based research firm, estimated Google’s share of U.S. mobile-ad revenue was 52 percent in 2011, driven by searches. Google earns about 95 percent of all U.S. mobile-search ad revenue, the firm said. 

Google was the leader in U.S. Internet search in February with 66.4 percent of the market, according to ComScore, an Internet market research firm. 

Microsoft made a failed attempt to wrest away the default search engine position on the iPhone from Google in 2010, according to two people familiar with the matter, and Apple is starting to use the U.K.-based OpenStreetMap Foundation’s service, which may signal it’s seeking to ease its reliance on Google Maps, according to the Macquarie report. 

“Our sense is that Apple wants to help Google less and less, but they still provide the best search experience for Apple users,” Schacter said. 



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