Local search company Yelp has filed a lawsuit against Google, accusing the tech giant of using its search engine monopoly to thwart competitors.
Yelp focuses on public reviews of local neighborhood businesses, with the company making money by selling local search advertising. The lawsuit accuses Google of abusing its “monopoly power in general search” to divert traffic away from competitors to its own local search product.
Companies such as Yelp are known as specialized vertical providers (SVPs), as they respond to user queries on a specific subject matter through proprietary, structured data unavailable elsewhere. Other SVPs include Glassdoor for jobs and employers, Expedia for travel, and Zillow for real estate and apartment rentals.
The lawsuit argues that on a level playing field, SVPs such as Yelp threaten Google given the ability of these platforms to siphon traffic and ad revenues away from the tech giant.
At one time, Google sought to acquire Yelp, an offering that was rejected. Google then began a “years-long mission” to restrict Yelp’s ability to reach customers through Google search, Yelp alleges.
“Google has engaged in numerous anti-competitive practices, including stealing information from Yelp’s website and passing it off as Google’s own; preferencing Google’s own local search results over Yelp’s; implementing a ‘OneBox’ feature to prioritize Google’s own inferior local search services at the top of the search results page; and even going so far as to tweak its algorithm and steer customers away from Yelp,” the lawsuit reads.
Google’s actions to prioritize its local search products over competitors allegedly prevent other businesses from achieving scale and reaching more consumers.
This enables the tech behemoth to retain dominance in these markets, reducing competition in the ad space and allowing it to extract higher fees from advertisers, according to the lawsuit.
Yelp is arguing that Google’s conduct has lowered its traffic and ad revenues. It is accusing Google of violating the Sherman Antitrust Act as well as California’s Unfair Competition Law.
Company Responses
A Google spokesperson defended the company against the lawsuit, telling multiple media outlets that “Yelp’s claims are not new” and that “similar claims were thrown out years ago by the FTC [Federal Trade Commission], and recently by the judge in the DOJ’s case,” according to a statement emailed to The Epoch Times.“On the other aspects of the decision to which Yelp refers, we are appealing. Google will vigorously defend against Yelp’s meritless claims,” the spokesperson said.
Google said that Yelp has been “lobbying” antitrust enforcers for more than 15 years to bring “failed self-preferencing claims” and yet none of the agencies have pursued such an action.
Over a decade ago, the FTC found there was no evidence to suggest that Google’s decision to display “its own vertical content at or near the top of its search results page was a product design change undertaken without a legitimate business justification.”
Google said its search results have “greatly benefited” both consumers and local businesses, with the company’s local search driving more than 6.5 billion connections for businesses every month.
Yelp General Counsel Aaron Schur told The Epoch Times that Google’s statement was “misleading” and that “Yelp’s claims have never been pursued in court, let alone thrown out”
While a 2011 FTC investigation on Google’s anticompetitive conduct in different search verticals ended in 2013 without filing any suit, “a later leaked FTC staff memo made clear that FTC staff had recommended legal action,” he said.
Antitrust Cases Against Google
U.S. District Judge Amit Mehta ruled in early August that Google violated antitrust laws in another case filed in October 2020.The 2020 lawsuit accused Google of illegally paying mobile manufacturers, wireless carriers, and browser developers to become the default search engine, preventing people from exploring alternate choices. In 2021, Google paid such partners $26 billion to secure its leading market position, according to Mehta.
In an emailed statement to The Epoch Times, Kent Walker, president of Google Global Affairs, said that the decision “recognizes that Google offers the best search engine” but concludes that the firm “shouldn’t be allowed to make it easily available.”
Google is also facing an antitrust lawsuit filed by developer Epic Games, which is accusing Google of monopolizing the market for distribution of mobile apps to Android users and the market for processing payments.
The FTC filed an amicus brief in the case, suggesting that the court take strict actions against such practices.
When using such content for its AI, Google does not make any payment to the publishers, the letter states.
Google now plans to deploy its GAI products nationwide, it notes. For instance, Google aims to place its AI Overviews atop search engine results. AI Overviews offer a preview of a searched query.
Positioning such content at the top “will reduce click through to publishers’ websites even further and thus further strengthen Google’s monopoly,” according to the group.
“Google’s AI Overviews will significantly reduce publishers’ ability to monetize their content through advertising, subscriptions, and affiliate links, and instead drive that monetization directly to Google,” it stated.
