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Google Faces Senate – Serving Consumers or Threatening Competition?

Google Says It Is Like GPS of the Web

A US Senate subcommittee tomorrow will hold a hearing, “The Power of Google: Serving Consumers or Threatening Competition?” Google CEO Eric Schmidt is scheduled to appear alone, with critics of Google’s behavior slated to follow in a subsequent panel.

In the lead-up to Schmidt’s testimony, Google (GOOG) has hired dozens of Washington, D.C., lobbying firms and has touted its pro-competitive behavior in advertisements. And in a recent online post, Google reminded readers that its users have a choice in search engines. Google isn’t a “gateway to the web”–a phrase it suggests critics might use in Wednesday’s Senate Antitrust Subcommittee hearing. Rather, the Mountain View, Calif., company’s service is more like a guide.

“Google is more like a GPS for the Internet–a helpful guide, but not necessary to get around,” the post reads.

Google is being accused of having a “monopoly” on search, though its market share is only 65%, and it charges consumers nothing for its services. This makes the anti-trust issue interesting.

Dozens of businesses have come forward to complain on Capitol Hill that Google is giving preferential treatment to some of its products and services by leveraging its dominant position to an unfair advantage. Critics have complained that Google favors its own services and content in the company’s popular search engine.

The Senate antitrust hearing technically has no connection to an ongoing federal inquiry into whether Google has unfairly blocked or eliminated search competitors, to the detriment of consumers. But Schmidt will be under oath, and experts said his answers could affect Google’s public image, and perhaps bolster or weaken the momentum of the Federal Trade Commission antitrust investigation. Congressional testimony from Microsoft founder Bill Gates in 1998, perceived by many as arrogant and dismissive, was quickly followed by a formal government antitrust suit.