With a real threat of antitrust and privacy regulation on the horizon, Google is on track to become this years top corporate lobbying spender in the US
Figures released last week show that Google spent a record amount of almost $6m lobbying in Washington DC in the past three months, putting the Silicon Valley behemoth on track to be the top corporate lobbying spender in the US. Last year it ranked No 2, behind Comcast.
Given the increased antitrust scrutiny that is coming from the Democrats new Better Deal policy platform, Donald Trumps random tweets attacking Googles fellow tech giant Amazon for its connection to the Washington Post, and his adviser Steve Bannons recent comments that Google and Facebook should be regulated as utilities, it is likely Google will only increase its lobbying expenditure in the next few months.
The largest monopoly in America, Google controls five of the top six billion-user, universal web platforms search, video, mobile, maps and browser and leads in 13 of the top 14 commercial web functions, according to Scott Cleland at Precursor Consulting.
As the controversial Trump-supporting PayPal billionaire Peter Thiel points out, companies like Google dont like to advertise this fact. They lie to protect themselves, Thiel says. They know that bragging about their great monopoly invites being audited, scrutinized and attacked. Since they very much want their monopoly profits to continue unmolested, they tend to do whatever they can to conceal their monopoly usually by exaggerating the power of their (nonexistent) competition.
For years, banks, oil companies and defense contractors dominated the Washington lobbying business. Because controlling government regulation and government contracts was key to their business success, shareholders saw the expenditure of millions a year on lobbyists and political contributions as an unavoidable cost of doing business.
When the federal government began pursuing Microsoft for antitrust violations in 1992, the Seattle software giant was caught off guard. It had almost no presence in Washington and spent almost no money on lobbyists.
That soon changed. For its part, Google, as it began to assert its domination of the search advertising business, started to take steps to ensure it had a strong presence in Washington. In 2002, Google spent less than $50,000 on lobbyists; 10 years later it was spending more than $18m a year.
Now, with a real threat of antitrust and privacy regulation on the horizon, Google has come to the same conclusion those earlier industries did that controlling Washington politicians and regulators is a cost of doing business.
And the company has not been afraid to use its muscle. The probable reason Google lost in Europe and won in the US in its battles over favoring its own products over those of smaller players is more about the campaign finance system than the differing regulatory regimes on either side of the Atlantic.
Since Google began spending more on lobbying than defense giants such as Boeing around 2010, it has been able to intimidate American legislators and regulators, and it has tools at its disposal far more powerful than anything deployed by Boeing.
In 2012, when the House of Representatives was considering the Stop Online Piracy Act (Sopa), which aimed to crack down on copyright infringement by restricting access to sites that host or facilitate the trading of pirated content and specifically targeted search engines such as Google that linked to pirate sites, Google put this image on its search page for 24 hours:
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