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French Court Calls Free Google Maps Unfair Competition 238

Posted by timothy
from the protecting-people-from-benefits dept.
jfruh writes "A French court has ruled that Google is unfairly subsidizing its free mapping products, making for unfair competition with paid services. This might seem ridiculous, but keep in mind that Google started charging for use of its mapping API once the free version had come to dominate the market."
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French Court Calls Free Google Maps Unfair Competition

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  • by bonch (38532) * on Thursday February 02, 2012 @12:21PM (#38904069)

    This might seem ridiculous

    Why would it?

    Microsoft was punished for pumping a market with a free product, with its development supported by revenues from a monopoly product, so that they could afford to give it away where competitors could not. If Google offers something for free, kills off its competitors who were charging for their version, and then starts charging when they're the only ones left, then the French court has a point.

    Even the headline in the linked article is absurd: "French court protectionism fines Google Maps for succeeding". No, that's not what they were fined for. They were fined for what French competitor Bottin claimed would happen two years ago--Google would offer Maps for free, make their competitors go bankrupt, and then start charging for Maps once they controlled the market. That's precisely what ended up happening!

    • by NeutronCowboy (896098) on Thursday February 02, 2012 @12:40PM (#38904341)

      Still trolling, I see. A few quick notes:
      * Google doesn't have a monopoly anywhere, even in search.
      * Google Maps is not given away, it sports ads, and the API costs money to access
      * You fail to mention Mapquest, or MS maps. Why just sue Google for its maps? Because it is the best one out there?
      * Why should Bottin be kept alive? Why not Garmin?

      In short, you're wrong on two fundamental counts: that this is anything but protectionism of the most basic nature, and that somehow Google Maps is both special, and not, in the world of online map services.

      • by pijokela (462279) on Thursday February 02, 2012 @12:47PM (#38904435)

        Still trolling, I see. A few quick notes:
        * Google doesn't have a monopoly anywhere, even in search.

        Google search most certainly is a monopoly. A legal monopoly does not require 100% market share. Companies have been deemed monopolies with under 50% share and Google is way higher then that - go google it if you don't believe me.

        Now, having a monopoly is not illegal, but using your monopoly profits to corner other markets is illegal. This is exactly the same thing that MS was convicted of a decade ago. Google it. When MS was killing Netscape it took the authorities years to act and the trial also took forever to end - Google just hasn't been doing this long enough to end in court yet.

        • By what definition? From http://definitions.uslegal.com/m/monopoly/ [uslegal.com]:

          Monopoly is a control or advantage obtained by one entity over the commercial market in a specific area. Monopolization is an offense under federal anti trust law. The two elements of monopolization are (1) the power to fix prices and exclude competitors within the relevant market. (2) the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen or historical accident.

          I have no idea how Google Search has the ability to either fix prices or exclude competitors through anything but offering a better product. Feel free to provide your argument, but at this point I see no evidence that Google is in a position where it either has a monopoly (control of or advantage in the search market), or that it is using monopoly power to advance that position.

          • by s73v3r (963317) <.moc.liamg. .ta. .r3v37s.> on Thursday February 02, 2012 @01:11PM (#38904745)

            Why don't you read your definition again? According to that, Google most definitely does have a monopoly in search. They are dominant in that area. And what they're getting slapped for is not for having a monopoly on search, which is quite fine, but by abusing that monopoly to edge themselves into other markets and drive out competition.

        • Your right, it's not all about market share. It's about being able to control the market, and abusing that control.

          I certainly have a choice to not use google maps, or google search. I can easily switch from google maps, to yahoo maps, or to mapquest; it takes seconds. Absoluty nothing ties me to google.

          This is not true with OSes. If I switch from windows, to linux, I will not be able to run my applications. OS makers have much more potential than search engines, to abuse their monopoly positions.

      • The same could have been said with microsoft. There were (and are) other operating systems, web browsers, spreadsheet applications, word processing applications, etc. The courts said at the time microsoft had enough of a lead that by leveraging that lead into other markets that is wrong.

        Google is charging when it did not in the past. If google didn't change there would be no issue. The change in behavior is the problem. If you kill the competition with a free product then when you are the only game in town,

      • by s73v3r (963317) <.moc.liamg. .ta. .r3v37s.> on Thursday February 02, 2012 @01:09PM (#38904705)

        * Google doesn't have a monopoly anywhere, even in search.

        Maybe you should stop being a child and trying to insinuate that the only way someone can have a monopoly is by being the only actor. That's not true, and hasn't been for a long time.

        * Google Maps is not given away, it sports ads, and the API costs money to access

        It was with respect to the developer API, which is what the case is about. You could use that API for FREE, not free + ads. And now that they are the dominant player in the space, and one could easily say they got there because they were free, they are raising their prices. That is the very definition of anti-competitive.

        You fail to mention Mapquest, or MS maps. Why just sue Google for its maps? Because it is the best one out there?

        Because they're the ones with the legal monopoly.

        Why should Bottin be kept alive? Why not Garmin?

        Why should Google Maps get to survive by subsidies from other Google divisions? Why can't they compete on their own?

        • Maybe you should stop being a child and trying to insinuate that the only way someone can have a monopoly is by being the only actor. That's not true, and hasn't been for a long time.

          And maybe you should get some reading skills. I have the sneaking suspicion I know more about what it takes to be declared a monopoly, and what is actually a crime when it comes monopoly behavior than you. I provided a handy link a bit above in case you are interested.

          And now that they are the dominant player in the space, and one could easily say they got there because they were free, they are raising their prices. That is the very definition of anti-competitive.

          How does it differ from new companies offering a deal to anyone who tries them? Furthermore, you still haven't demonstrated that Google Maps is the dominant player in the space of online map services, or how Bottin somehow is affected by them.

        • by sulimma (796805)

          > Maybe you should stop being a child and trying to insinuate that the only way someone can have a monopoly is by being the only actor.
          What do you think "mono" means in the word?

          The definition on Wikipedia is:
          "A monopoly (from Greek monos (alone or single) + polein (to sell)) exists when a specific person or enterprise is the only supplier of a particular commodity."

          German anti trust laws therefore don't talk about monopolies but about illegal market domination which is assumed to happen above 30% mark

      • If so, why wasn't mapquest a monolopy? I think yahoo maps were also around before google maps? Why wasn't yahoo fined?

      • >Google doesn't have a monopoly anywhere, even in search.

        A 91% share in France isn't a monopoly?

        http://googlesystem.blogspot.com/2009/03/googles-market-share-in-your-country.html [blogspot.com]

    • Re: (Score:2, Flamebait)

      by s.petry (762400)

      Apples to Bananas comparison.

      Microsoft took technology that already existed and people already used and paid for and gave it away free until the competition died out. (Word/Word Perfect Anti-trust suit ??). With Browser technology they forced Windows VARS to install IE and play by a set of rules that said no competitive products could be installed (initial Anti-trust suit) even if the customer requested it. When busted, they spit in the courts face and forced vendors by forcing vendors to only install

      • by HarrySquatter (1698416) on Thursday February 02, 2012 @12:48PM (#38904443)

        Sorry but Google Maps was not a new product and neither was internet map services when Google acquired it. Mapquest was around since 1996 and even OpenStreetMap predates it and there were plenty of other services. But hey we gotta keep up the Google defenses!

        • by s.petry (762400)

          Sorry, but you miss the very obvious point I made: What is Google charging for? It's not the Google Map service. It's the APIs so that you can access the Google data without Google services.

          Comparing that to what Microsoft did, and does is simply ignorant. Sorry, no other way to put it. Ignorance can always be cured with education though.

      • by s73v3r (963317) <.moc.liamg. .ta. .r3v37s.> on Thursday February 02, 2012 @01:12PM (#38904775)

        It became extremely popular, and is still FREE to use for anyone.

        No, it's not. Not for DEVELOPERS, which is the entire point of this suit. The Maps API used to be free. Now that they have a dominant market position, it's not.

    • by zill (1690130)

      Microsoft was punished for pumping a market with a free product, with its development supported by revenues from a monopoly product, so that they could afford to give it away where competitors could not.

      Wrong. Microsoft was convicted of tying [wikipedia.org] (among other things). Bundling two products in the same shrinkwrap is tying. Offering two services on two separate websites is not tying.

    • Re: (Score:3, Funny)

      by Anonymous Coward

      Even the headline in the linked article is absurd: "French court protectionism fines Google Maps for succeeding". No, that's not what they were fined for. They were fined for what French competitor Bottin claimed would happen two years ago--Google would offer Maps for free, make their competitors go bankrupt, and then start charging for Maps once they controlled the market. That's precisely what ended up happening!

      So instead of France doing something back then, when the competitors could have made money, they waited until those competitors went bankrupt and levied a fine for their *own* profit?

      I like their business strategy.

    • by Jorl17 (1716772)
      Punished? You call that punishment? I'm not saying google is innocent at all, I'm just saying the big fat bastards at Microsoft weren't punished in a meaningful way. And, for the record, I have installed 5 windows machines and have never seen the "browser ballot". Nor did I see it in existing machines.
    • Microsoft was punished for pumping a market with a free product, with its development supported by revenues from a monopoly product, so that they could afford to give it away where competitors could not.

      Can we at least try to have a less tenuous relationship with facts? Microsoft wasn't charged with dumping (which is what you're accusing Google of), they were charged with tying, which means refusing to allow someone who wants to buy Windows to get it without Internet Explorer (ostensibly discounted for the value of Internet Explorer). They're totally different things.

      Incidentally, the reason Microsoft wasn't charged with dumping -- and the reason that isn't what Google is doing now -- is that software and

    • by ATestR (1060586)

      Bogus. Google's big competition in the States is ESRI, with their ArcGIS products. ESRI also has a free version that provides users limited functionality, and they also have a version that users pay a boat load of money for... for a LOT more functionality.

      As another user pointed out, Google is not alone in this space. If Bottin has a better product, they will be able to make money with it. If all they have is a bare bones, basic map service, they are going to have a hard time to convince me.

      • by ATestR (1060586)

        I should say that ESRI is Google's big competitor in the MAPS field. Don't do much in Google's other areas.

  • Airbus (Score:2, Insightful)

    by Anonymous Coward

    Just sayin. France is being hypocritical.

  • Loss Leader (Score:4, Insightful)

    by Aladrin (926209) on Thursday February 02, 2012 @12:35PM (#38904279)

    Are they going to make all loss leaders illegal? Seems to me it works the same for everyone, regardless of the industry.

    • No it wont make loss leaders illegal. This is just typical punishment against anti-competitive tactics of using a near monopoly in one segment to finance pushing your competitors out of another segment. You know like what Microsoft was punished for with IE?

      • by GodInHell (258915)
        The fact that Google uses Maps to sell ads and therefore MAKE money on maps means ... what exactly?

        -GiH
        • And Microsoft used IE to drive traffic to msn.com (default home page), which also showed ads, thereby making money... right?

        • Nothing with respect to this topic, because it's not about Google Maps. It's about the Google Maps API, which was free, which killed the competition who charged, and now that there is no competition has switched to a for-pay model. The only reason the API was free in the first place was Google could keep it on life support using revenue from its search service.
    • by DdJ (10790)

      Are they going to make all loss leaders illegal?

      That certainly would be nice, wouldn't it?

    • by s73v3r (963317)

      Loss leaders are not illegal. Using a loss leader to drive out competition, and then once you have a dominant marketshare, raising the price of that loss leader is.

    • Re:Loss Leader (Score:4, Insightful)

      by DaveGod (703167) on Thursday February 02, 2012 @01:19PM (#38904907)

      A loss-leader is where the long term strategy is to have one product/service always being sold at a loss (or anyway "not enough" profit), in order to attract custom to a profitable product. An example for a manufacturer is razors (money's in the blades), an example of an outlet is milk (money is in the other stuff the customer picks up).

      The argument is more that Google is using penetrative pricing. This is where you have a short term strategy to introduce a product/service at a loss in order to gain a foothold in the market, whereupon you can raise the pricing to competitive levels.

      Penetrative pricing pricing becomes uncompetitive when the objective isn't to gain just a foothold, but to dominate the market. Regular penetrative pricing increases competition in the market over the long term while monopoly abuse decreases it. One indicator, not definitive, that the line has been crossed is when the amount of losses being racked up is so disproportionate that monopoly rents would be required to obtain a reasonable return on all that financing.

      This is also why the charge tends to apply to existing companies moving into a new market and not a new up-start. If an up-start can obtain that kind of financing then the incumbents and other up-starts should be able to find it too - it's all just an action of a free and competitive market. Google on the other hand can throw so much resource at something that economic principles of "free" or "competitive" market forces do not apply.

  • by Kenja (541830) on Thursday February 02, 2012 @12:36PM (#38904289)
    For as long as I can remember, it was a paid service unless you where going to use under a given number of hits per month (and it was not a large number last time I checked). That let people play with it, but any serious work required a license.
  • by Rotten (8785) on Thursday February 02, 2012 @12:45PM (#38904397) Journal

    As somebody working on the remote sensing/mapping/gis field for 10+ years. I tend to agree.

    It's a long debate, but clearly the new concept of "paid api" it's confusing.

    I perceived gmaps as a free tool in the beginning, but now, as they charge, it's no longer a tool, but a competitor.

    Many hi definition data available "freely" on google maps/google earth, it's the result of a private customer paying for that data, and the by some weird agreement between the companies that run the satellites and google, the information ended up "FREE" on google maps.

    A real life story:
    I paid 250+K for 1 meter imagery (ikonos) for a project that was covered in google maps using old 30m imagery (90's landsat). Months later google has the 1m coverage i ordered and paid for, available for FREE to anyone else.

    So i'm not only competing against google, but against people who no longer needs to order a quality work, since now it's there FREE.

    Duh! That's certainly UNFAIR.

    • by Khyber (864651)

      Annnd... why haven't you sued?

      • by Rotten (8785)

        I found myself a more specialized line of work, some line of work google won't move into. High precision mapping won't be the case for google maps in the next 10 years. Unless my work starts appearing for free on google maps.... get my point?

    • by GodInHell (258915)
      I'm sorry -- did you contract for exclusive rights to the 1m data? Are you arguing that Google stole your data and put it up for free? Google's market is in ads, not data -- they give away the data to get the ads. Now they're charging for the API -- in part because, hey look! profits!, but also because it keeps other sites for hosting google data without google ads (and thus denying Google the only value google scrapes from its maps data).

      So ... what's unfair exactly? Maybe that the company that sold y
    • Duh! That's certainly UNFAIR.

      If you meant that a huge publicly traded company under enormous scrutiny somehow directly or through arrangements with other people violeted contracts to which you were a party, then, sure. But you don't seem to be saying that. You seem to be saying that the marketplace has changed, and that you wish it hadn't.

      • by Rotten (8785)

        The marketplace haven't really changed, it's the same marketplace but now there's a new player offering things for free for some years, wiping out some competitors or pushing them away from the marketplace. And now....when their product it's a heavyweight champion...well...now they start to charge. That's unfair.

        The fairness of including someone else's information in their product it's another story.

        I'm a big supporter of the idea that information and knowledge should be free. But if that "freedom" has a pr

    • by roman_mir (125474)

      So i'm not only competing against google, but against people who no longer needs to order a quality work, since now it's there FREE.

      - good.

      Duh! That's certainly UNFAIR.

      - nonsense. It's completely fair and it's good, and it's progress and it's what free market is about, and government meddling with it is evil and bad for the economy and the free market.

    • by dlcarrol (712729)

      Duh! That's certainly UNFAIR.

      ... and the great logic fail is that "Unfair" should also be "Illegal"? What about when you buy a new TV on a Wednesday and miss out on the Black Friday deal? Was that fair to you? Shouldn't one assume that prices change, volume matters, etc? This is a perfect example of a "free", but not "perfect" market. Taking your specific case, you can no longer differentiate yourself via access to special data (say, airline routing and pricing data?), but rather have to supply an additional service. Welcome to the rea

  • OpenStreetMap (Score:5, Informative)

    by b0bby (201198) on Thursday February 02, 2012 @01:22PM (#38904941) Homepage

    If you want a really free map source, try openstreetmap.org & some of the apps which use their maps. Still a work in progress, but much improved over even a year ago. If every geek on /. cleaned up their neighborhood map it would be better than the paid maps - I've certainly added features like weird one way streets and things around me which don't show up on commercial maps.

    • by Rotten (8785)

      Same maps that were altered/changed/wasted by google's IP range "contributors"?

  • See Google Maps lures in unsuspecting users, whose eye balls are then sold to advertisers. Now these eye balls are not sold for free by any means.
  • ... keep in mind that Google started charging for use of its mapping API once the free version had come to dominate the market.

    I'm not really seeing the problem here.

  • Google should just immediately start charging everyone in France for access to Maps. If their government wants to play these kinds of protectionist games- give them what they want...
  • After all, they're undercutting pay-to-view outlets like HBO, Cinemax, etc.

    This seems to me the real analogy. The traditional broadcast networks get their revenue from advertising, like Google, and their product available to the end-user free-of-charge. HBO gets its revenue from the end-user directly.

    I don't think anyone would make the argument CBS is unfairly subsidizing their product and I don't think Google is either even if the temporary market condition is such that Google is most popular.

  • >This might seem ridiculous, but keep in mind

    replace "but" with "because"

  • Maporama (Score:4, Informative)

    by DrXym (126579) on Thursday February 02, 2012 @02:10PM (#38905775)
    A French company called Maporama was producing free maps before Google Maps ever turned up. It was like Mapquest for non US destinations and pretty decent for it too. The innovation Google brought to maps was you could interactively drag them around rather than the clumsy d-pad style controls that most map sites including Maporama used. So I don't really buy the idea that free was anticompetitive because it was entering a market where free was the precedent already.

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