Are Google's practices hurting consumers?

When you enter a simple search term into Google, your results are often top-heavy with Google-affiliated content, Google executive chairman Eric Schmidt explained last year in Berlin. However, the company’s practice of promoting its own content may be harmful for consumers who would prefer results prioritized solely by relevance, a new study suggests.

The study, sponsored by Google competitor Yelp, found that users engage with “organically determined” content that includes links from competitors 45 percent more than with results generated by Google’s algorithm that weights its own content.

“This suggests that by leveraging dominance in search to promote its internal content, Google is reducing social welfare –­ leaving consumers with lower quality results and worse matches,” the study reported.

Tim Wu – co-author of the paper entitled “Is Google degrading search? Consumer Harm from Universal Search” and leader in the net neutrality movement – told The New York Times he used to defend Google’s competitive practices, but Yelp convinced him to do the study. The results, he said, were surprising.

“The idea that you can build a better version of Google search engine pretty easily if you don’t exclude competitors to me was a pretty startling finding,” Mr. Wu said.

In an email to SiliconBeat Monday, a Google spokesperson called into question the validity of the study, accusing the Yelp research team of using “flawed methodology that focuses on the results of just a handful of cherry-picked queries.”

Google asserted in the email its commitment to providing “the best results for its users.” Some evidence still suggests Google may be doing just that.

Users searching for simple, objective information – like the answer to an arithmetic problem, a currency conversion, or a weather forecast, for example – save time with Google’s services that give these answers as a top search result, the study acknowledged. It only becomes a problem when the search engine is asked more subjective questions – like searching for the best doctors or restaurants.

Another potential flaw in the study is the assumption that more clicks equals higher user satisfaction, critics said according to The New York Times. Clicking through more links may be a sign of frustration, rather than satisfaction.

According to the New York Times, however, Google has been accused on several occasions of violating antitrust laws, and the evidence of this study could further fuel that argument.

The European Commission charged the company in April with abusing its market power by distorting search results in its favor, Reuters reported.

Google has until August to reply to the charges, and faces a fine based on the revenues it has gained from European Union countries.

The Federal Trade Commission’s (FTC) bureau of competition also investigated Google’s practices in 2012, and recommended that the FTC sue Google for anti-competitive practices. The agency ultimately chose not to pursue a lawsuit, angering Google’s critics and competitors.

The Yelp study may provoke the FTC to reopen the investigation, The New York Times reported, and could bolster the European Commission’s case.