Essay on Antitrust: Monopoly and Search Engine

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Trust Issues
Stephanie Lowe
DeVry University
January 24, 2015
Trust Issues The purpose of this paper is to examine the recent antitrust investigations of the super search engine Google. Competition law seeks to maintain market competition by regulating anti-competitive conduct by companies (Taylor, 2006). Competition law is known as antitrust in the United States but is referred to by other terms such as anti-monopoly. It is important to sustain antitrust laws to promote and maintain fair competition in markets and to decrease barriers to entry into the market for other companies. Google is a world renown search engine that was being investigated for multiple antitrust accusations across the globe and this paper will discuss further the benefits and losses of a monopoly in today's market. Antitrust refers to any question of the involvement of a company or firm in any act that may seem its intent is to achieve a monopoly of specific enterprise ultimately giving the company or firm all market power. With an increase in internet usage with smart phones and tablets, consumers are searching for a powerful search engine that produces the quickest and most relevant results. Google has been under investigation for using the highest paying advertiser to appear first in their search engine. The accusation at the heart of the Federal Trade Commission's (FTC) investigation is that Google is hindering specialized search providers by returning so-called "universal" search results, which directly answer the question posed rather than referring the consumer to another website (Savitz & Cooper, 2012). Legal and ethical questions are being considered when users' search results are being manipulated without preference or relatively but more based on the highest paying advertiser. Google was held to the standards of the Sherman Antitrust Act of 1890 which was first proposed in order to ensure that no specific firm or company would have sole power over an economic market. It prohibits agreements on things such as fixed pricing or agreements of companies to only trade amongst themselves which creates monopolies. There are also other agreements made between rival firms attempting to disrupt the market by agreements on price and sharing inside information on trading and this is known as collusion. The economic market is protected by many laws and commissions to protect public trading and try to protect consumers from price fixing from companies seeking higher revenue. With such strong accusations against a firm, both pecuniary and non-pecuniary costs must be weighed. A loss in total revenue, fines, and market share is an example of pecuniary costs that a firm may have to sacrifice while striving to adhere to strict market laws. Also, non-pecuniary costs are damages or losses to a firm that cannot be measured by a monetary value or loss. Despite laws and regulations in today's global market and the risk of pecuniary and non-pecuniary losses, monopolies and oligopolies do exist. Although there are negative aspects of these markets for the consumer due to the ability for price inflation and less incentive for a monopolizing firm to be efficient, there are benefits such as innovation and more revenue for research into providing a better product for the consumer. For argument sake, let us consider that Google is indeed a modern day monopoly. It would be
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