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Don't Do It, Google

May 2, 2006

As Microsoft prepares for the new release of the new version of its browser, Google is grousing about one of Microsoft's marketing strategies. Internet Explorer E7 will likely have a little search bar in the upper right hand corner of the browser, just as Safari and Firefox do now. With it you will be able to access a number of search engines.

As usual, the argument comes down to who gets to set the default engine. Microsoft wants MSN search to be the default. Google complains that this will give the company an unfair advantage and deny consumer choice. MS already owns the operating system, and the argument about whether Internet Explorer can be preinstalled and defaulted on the operating system was long ago settled in MS's favor.

MS seems to be planning further to leverage its control of the desktop to make further inroads into the search market, in which it is currently not doing very well. This is the source of Google's complaint, and vague insinuations are in the air to the effect that Google might, just might, ask the Justice Department (and the European Commission) to intervene.

Microsoft responds that it is not forcing anyone to use its search engine. Consumers are free to pick any one they want to. And while that's true, Google knows full well that consumers tend to stick with defaults. We live in a world in which most people don't even know that they can control what displays on the desktop. For that matter, Microsoft serves 80 percent of the browser market even though its browser is one of the least secure and slowest of all the choices out there.

For that reason, many sophisticated computer users will be sympathetic to Google's case. To accept Microsoft's defaults is to restrict in effect people's computing experience. Might an intervention actually be good for consumers and good for the industry?

No. And we've been through this many times before.

In a free society, producers enjoy the freedom to manage how their products are presented to the customer. Bad decisions in this regard are not as profitable to the company as good ones are. We can't rule out the possibility that people will pick up on the fact that Google currently offers far superior search technologies to Microsoft. To stave off a consumer revolt, Microsoft has more incentive to improve its search ability, while Google has incentive to maintain its advantage.

But what if Microsoft still dominates the market with inferior technology? Here we must speak to a common myth about free markets. It is not the case that the best technology always wins. All we can say about free markets is that there is a tendency for the most economically suitable products to dominate the market over the long term. That could mean that mainstream America will settle for convenience over quality, and who is to say that the proper economic course is always to prefer the opposite?

There is also the matter of property rights. MS does own Windows and it will own its successor too. It also owns Internet Explorer. It also owns its search engine. How it bundles those products must be left to the owner. The alternative is to get the government involved in designing and managing how software is built, managed, and marketed. Google is a company that has always thrived on its independence and innovative strategies. Government intervention is not in Google's long-term interest either. A government big enough to punch out Google's competitors is big enough to punch out Google too.

Rumors have abounded for years that someday Google will come up with an operating system that runs off its own servers and provide a serious competitive alternative to Microsoft. That may yet happen, in which case Google needs to be free to compete without having to jump through regulatory hoops. We need also to remember that antitrust complaints are starting to be leveled against Google itself, and it would be unwise to participate in an action that can only embolden the regulators.

The software industry is filled with rivalries of the most intense variety. They might all hate each others' guts, and no one is hated more than Microsoft, simply because it is the biggest and the one that has marketed its way to the top. But what all these companies need to agree upon is that they have a common enemy, The State. It is not the friend of rivalrous competition but its enemy. Google needs to compete in a free market, think about the long term, and stick to what it does best, which is astounding its customers and rivals with great products. This is how it has progressed so far.

It would be a crying shame to see this wonderful company participate in an action that will end up tightening the already tight level of control that government now exercises over society.

No pundit can do Google's thinking, but what about a small link on Google's homepage that says: "Make Google your default search engine" – and so clicking it overrides MS's defaults? That's the way to compete peacefully.

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Lew Rockwell is president of the Mises Institute and editor of LewRockwell.com. Rockwell@mises.org. See his  Lew's Columns on Mises.orgComment on the blog.


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