Author: Mathew Ingram

This post is the second of four stories about my experiences snooping on my kids and their online behavior over a period of years. Part one is here, part three is here and the final instalment is here.

When parents stoop to spying on their children, it’s usually because they are afraid something terrible is happening that they don’t know about — and often they turn out to be right. In my case, I chose to do it partly as a way of learning how to use the tools and partly as a kind of research project into my own children and their online behavior. And I learned a lot.

In the first part of this series, I talked about how reviewing some keystroke-logging software in the early 2000s — designed primarily for businesses to monitor their employees at work — lured me into eavesdropping on my three kids over the course of a decade, using a variety of tools that at times made me feel like I worked for the National Security Agency.

Tracking the online behavior of our first daughter didn’t reveal all that much, apart from the usual teenager angst, but things were somewhat different with our second daughter — in part because she was a different person, obviously, but also because the way she used the internet was different.

As I tried to point out in my first post, I am well aware of the ethical quandary that I dove into when I started this monitoring process, and if I wasn’t already aware of it when I started, I was regularly reminded of it whenever I brought the topic up with friends and fellow parents. Many of them accused me of acting like the secret police, and of not trusting my daughters enough — and yet, at the same time, I thought I could see in some of them a secret jealousy of my abilities, since they all felt the same parental desire I did: namely, to watch over our children in every way possible.

The dawn of the social web

Our first daughter was kind of an experiment, since I was new to the tools available, and the social web was also relatively new: there was no Facebook yet, and no Twitter, and blogs were only just becoming popular with a small group of hardcore nerds. LiveJournal was fairly prominent — although my daughter didn’t really use it — but the really big deal, especially for teenagers, was instant messaging via AOL and MSN Messenger and ICQ (anyone remember them?). As far as my oldest was concerned, that was the entire internet.

Apart from one brief mention of marijuana experimentation at a friend’s party, trolling through my daughter’s IM conversations and emails via the aforementioned keystroke-logging software didn’t produce much of interest. There were no secret messages to older men arranging to meet them at a shopping mall, or any of the other bogeymen that parents have been taught to fear when it comes to the internet. And of course, the fact that it was boring was very reassuring.

Our second daughter used instant messaging a fair bit, and I continued using the keystroke-logging program for that purpose, as well as some other tools that pulled in email, etc. But as she moved into her teenage years, she started to spend less time on instant messaging and on childish websites playing silly games, and more time on another category of sites that I had never heard of before: sites that when I look back on it were like early prototypes of social networks — but aimed exclusively at teenagers rather than broadly targeted ones like Facebook or MySpace.

Habbo Hotel and Gaia Online

Habbo Hotel was one example of this phenomenon: a site that used cheesy eight-bit graphics from some old handheld computer game to create a world where residents of a giant hotel could set up their own rooms for a variety of purposes — including music, games, or just chat — and then invite people into their rooms and interact with them. At one point, Habbo (which was owned by a Finnish company) was a huge internet traffic story, and my daughter and her friends spent hundreds of hours a month on it. In some ways it was the Facebook of its day.

The hard part for me and my NSA-style surveillance program was that Habbo also proved to be very difficult to effectively monitor using most of the tools I had — except maybe the one that took random screenshots at regular intervals, which used up a lot of resources (my brother-in-law actually blocked Habbo Hotel at the router level so that his teenaged children wouldn’t go there, and eventually had to shut the internet off at night because they still managed to find a way around his block).

The most interesting aspect of my daughter’s internet use was the amount of time she spent on a site called Gaia Online, which as far as I could tell was devoted to games and socializing primarily around Japanese anime TV shows. But my keystroke-logging program picked up something fascinating after awhile, which I admit I wasn’t expecting: My middle daughter, who hadn’t really shown any interest in writing for school purposes, was spending hours every day writing interactive fiction on Gaia Online — long and involved, emotionally complicated stories based around characters from anime shows.

An unexpected insight

Gaia Online was one of the first sites I came across that engaged in this kind of interactive fiction, where one writer would start a story and then others would add to it or take it in a different direction — or suggest different plot twists for the original author. This is almost exactly what Wattpad does now — the Toronto-based startup financed by Khosla Ventures allows authors (including some prominent ones like Margaret Atwood) to upload unfinished work and get feedback from readers.

The upshot of all this was that my snooping revealed not so much the questionable behavior I had been afraid of finding, but a whole side of my daughter that I had never really expected to find — a side that voluntarily spent hundreds of hours writing fiction and interacting with friends around that fiction. And while my daughter hasn’t become a famous writer (yet), she still carries on this behavior today, only now it occurs on Tumblr and is based around TV shows like Doctor Who and Teen Wolf. In a sense, this has helped to shape how she interacts with media as an adult, which I find fascinating.

This revelation made me feel even more torn when it came to my surveillance of her: On the one hand, I still felt bad for invading her privacy — something we have talked about since she stopped being a teenager — but I was also grateful in a sense for being able to discover this other side of my daughter, one that was filled with talent and a love of language and creativity. Does that make it worth all the snooping? That’s hard to say. I wouldn’t really wrestle with that question directly until I started to apply the same surveillance approach to our third and youngest daughter.

Tomorrow: How — and why — I decided to stop snooping on my kids.

Images courtesy of Shutterstock / Lightspring and Shutterstock / Vlad Star and Shutterstock / noporn

This post is the first of four stories about my experiences snooping on my kids and their online behavior over a period of years. Part two is here, part three is here and the final instalment is here.

This isn’t an easy thing to admit, but I felt a secret twinge of shame when I was reading the recent leaks about the National Security Agency’s surveillance program — the one that allows them to index all the phone calls of suspected threats, scoop up emails and other internet traffic, and even reportedly listen in on real-time voice and text chats. Why? Because I have either used or tried to use similar types of tools (on a much smaller scale, obviously) to snoop on, creep, stalk and otherwise digitally eavesdrop on the behavior of my children over the past decade or so.

While the tools may have changed over the years, and the websites and mobile apps and social networks they used have also evolved — from simple instant messaging and gaming through virtual worlds like Habbo Hotel and Club Penguin, all the way to Instagram, Snapchat and Tumblr — the ethical and social dilemma remains the same for many parents I think.

The NSA and its defenders have argued that what the agency does is justified — even though it may technically be against the Fourth Amendment — because it allows them to identify potential terrorist threats to the U.S. I made a similar argument to myself about the surreptitious monitoring of my daughters’ online activity: namely, that by doing so, I was helping to identify potential threats to them in the form of drug abuse, poor relationship decisions and other hazards of teenage life. Was I right to do so? To be honest, I’m not sure.

Invasion of privacy or parental right?

I do know one thing: when I casually mentioned to a friend and fellow parent several years ago that I was spying on my then-teenaged daughter while she was on the internet — capturing instant messaging logs, reading emails, even at one point using “keystroke logging” software to track what she typed — my friend was not supportive at all. Instead, she was horrified. How could I do this, she asked, when it was such an invasion of my childrens’ privacy?

At the time, I made the same argument that legions of parents before me have probably made, which is that my children really have no expectation of privacy while they are under my roof. In a sense, I figured they were subject to my laws rather than those of the Constitution — within reason, of course — and if I believed that invading their privacy was what was required in order to keep them safe, then I figured I should be entitled to engage in whatever behavior I saw fit. Shouldn’t I?

The hard part about all this, however, is that there’s a lot more involved than just reading your child’s diary or picking up the extension in the living room to try and eavesdrop on a call they are making from the basement. Although I have stopped snooping on my three daughters — since the oldest is now 24, our middle child is 19 and the youngest is almost 16 — I expect that there is so much technology out there that will allow you to track their every click and status update that you could (as I did) find yourself getting sucked far deeper into monitoring than you ever intended to go.

When I look back at it now, after almost a decade since I first began monitoring their online activity, I can see a number of lessons, some of which are more obvious than others. And I can see how in some ways it was a mistake, but in other ways it showed me things about my children — worthwhile, valuable things — that I would never have learned otherwise. And what’s also interesting is how different all three have been in a number of ways: in their use cases for the internet, in the technologies they chose, and in how all that affected my own approach to eavesdropping on them.

Keystroke capture meets teenager

My interest in all this got triggered in the early 2000’s, when I decided to do a review of some software that allowed anyone with access to a computer to capture the keystrokes of a user and store them in a file for viewing later. The software was targeted at employers, but parents were also a potential market — as an alternative to earlier “gatekeeping” software such as Net Nanny, which could be used to block certain websites from young children.

At the time, my oldest daughter — who was then about 13 — had been spending a lot of time talking with friends using Microsoft’s Instant Messenger, and I thought the software would allow me to eavesdrop a little bit on her conversations while also reviewing the software. I installed it as directed (it was just a driver that loaded before the keyboard driver, and stored all the information sent via the keys) and soon I was reading all of my daughter’s chat conversations.

For the most part, this was incredibly boring, I’m happy to say. Our daughter wasn’t the kind of troubled child who cried out for internet monitoring, so there was nothing outlandish like plans to meet up with some 35-year-old in Detroit. There was a lot of talk about boys and homework, and TV shows or books she liked. There wasn’t even any sign of “cyber-bullying,” which had become a big topic of conversation in the media, and which a niece of mine had been subjected to during her teenage years (another reason I was curious to try out the software).

A permanent loss of trust?

The only thing remotely interesting that turned up was a conversation about smoking pot one night at a friend’s party. Since 13 seemed a little young to be encouraging that kind of behavior, my wife and I had a little chat with our daughter about the wisdom of that kind of activity — without telling her how we found out about it — and that was pretty much the end of it. Eventually, I stopped looking at the emailed chat logs that the software forwarded me (it would send them based on certain word triggers as well) and went back to not paying much attention to what my daughter did online.

After the discussion with my friend and fellow parent who was shocked about my invasion of our daughter’s privacy, I did tell our kids that we had ways of looking over their shoulders online (without going into too much detail) and that we wouldn’t hesitate to use these powers if necessary. Better to be vague, I thought, so that they wouldn’t know what we were capable of — another echo of the NSA’s approach.

Obviously, my daughters’ emotional turmoil and fondness for certain bands isn’t even remotely comparable to the dangers of terrorism, but the parallels with what the NSA does (and what American citizens allow it to do in their name) still seem pretty strong to me. I believed that what I was doing was justified because I wanted to protect my daughters from themselves — but in the end, I decided that the loss of trust was actually much worse than anything I was theoretically saving them from. Is there a lesson for the NSA in there?

Thursday: My surveillance program continues with our middle daughter, and I discover something unexpected about her.

Images courtesy of Shutterstock / Lightspring and Shutterstock / Denis Vrublevski

While in New York this week for a GigaOM event, I had coffee and lunch with a number of media-industry insiders and observers, including Jay Rosen and Clay Shirky – two people I think are among the smartest media analysts in the business. And one thing that kept coming up is what I have chosen to call the “barbell problem” for media, and specifically for newspapers: in other words, the feeling that while both ends of the journalism spectrum are probably going to be fine, the middle is getting squeezed to the point where its future is uncertain at best.

So the New York Times, for example, is going through the same kind of uncertainty and upheaval as the rest of the industry – having to lay off staff, cutting costs, selling assets. But while the paper’s paywall and other measures may not totally fill the gap caused by erosion of advertising revenue, the NYT has enough resources to not only survive but do well. Likewise, the Financial Times and the Wall Street Journal will probably survive and prosper, along with some other large brands.

Some prominent journalism brands will likely be fine

This is exactly why Shirky and his coauthors on the recent “Post-Industrial Journalism” report from Columbia specifically excluded any discussion of the Times from their analysis of the future of journalism. As Shirky described it, it’s like the average driver measuring themselves by looking at someone who races on the Formula One circuit. Practically speaking, there are very few meaningful lessons other newspapers can learn from the New York Times.

That’s one end of the barbell. The other end is the ultra-small, hyper-local newspaper – the daily or even weekly broadsheet that serves a small town or region, where the disruptive forces of the Web haven’t made themselves felt as strongly and local shopping flyers are probably still a pretty good business. This is the kind of newspaper that billionaire Warren Buffett is buying up – the kind that still has a lock on a local market. Paywalls may work well here because of the lack of compelling alternatives.

And what’s in the middle? Everything else – medium-sized papers like the Miami Herald or the San Francisco Chronicle or the Boston Globe, as well as most of the larger metro papers like the Chicago Tribune and the Los Angeles Times and the Philadelphia Inquirer. What does their future look like?

Many of these papers have been trying to make paywalls work, but for most the results appear to be fairly lackluster at best – even the Boston Globe, which is far from the worst newspaper in a medium sized market, has attracted just 28,000 subscribers after more than a year. Its owner the New York Times has put it up for sale and may get less than $100 million for it, and that’s after removing the single most damaging part of the business from the equation – namely, the paper’s $200 million or so in pension obligations.

What happens to the news that doesn’t pay?

Those pension obligations are one of the biggest mill-stones around the neck of traditional media entities. And the bottom line is that even with some reader support, as Rosen and I discussed, these papers are going to have to shrink dramatically or come up with new forms of revenue, which is why the Washington Post is experimenting with what has come to be known as “sponsored content” (something we’ll be talking about more at paidContent Live on April 17)

In a recent post at Slate, writer Matt Yglesias responded to the somewhat fatalistic tone of coverage around the recent Pew report on the state of the media by arguing that as news consumers, we are better off now than we have ever been, thanks to social media and other forces. And it is easy to see how that is the case for certain topics and certain parts of the world – but as Dan Mitchell pointed out in a rebuttal to Yglesias, it isn’t the case for much local coverage of things like municipal affairs and public-policy topics.

So what happens to that kind of coverage as newspapers shrink and even die? If all the things that have subsidized that kind of journalism have been removed – the car ads and travel writing and so on – all these papers are left with is the kind of content that advertisers aren’t interested in and readers don’t want to pay for. What then? ProPublica and the Texas Tribune are interesting publicly supported models, but how scalable are they? Is every state or region going to have one?

Will some form of “citizen journalism” be able to fill this gap – whether it’s local bloggers or some kind of automated Twitter feed etc.? Perhaps. Will newspapers use outsourced services like Journatic or even robot journalists like Narrative Science? In all likelihood it will be a combination of all of these, and possibly other things we haven’t even thought of yet. At this point, the answers are a whole lot murkier than the questions.

Post and thumbnail image courtesy of Flickr user George Kelly and Jan-Arief Purwanto

There’s been a lot written over the past few years about the future of the news industry — how the rise of the web and social media have disrupted it, and how traditional players like the New York Times and others can recover from this disruption and repair their business models by using things like paywalls. But a new manifesto from the Tow Center for Digital Journalism at Columbia University says that trying to figure out how to repair or rebuild the news industry is a waste of time: the paper’s authors argue that there is no such thing as the “news industry” any more, in any realistic sense, and the sooner both new and existing players get used to that idea the better off everyone will be.

The authors of the Tow report are well known to anyone who pays attention to the future of journalism: Clay Shirky is a journalism professor and author of books like “Here Comes Everybody,” C.W. Anderson is an assistant professor at the College of Staten Island and a frequent commentator on media and cultural theory, and Emily Bell is the former head of digital at The Guardian newspaper and now director of the Tow Center. The paper — which Josh Benton of the Nieman Journalism Lab has done a nice summary of — is a combination of analysis of the current situation, philosophical statements about the nature of the problems facing the industry, and recommendations for how to adapt.

“[This paper] is not, however, about ‘the future of the news industry,’ both because much of that future is already here and because there is no such thing as the news industry any more. There used to be one, held together by the usual things that hold an industry together: similarity of methods among a relatively small and coherent group of businesses, and an inability for anyone outside that group to produce a competitive product. Those conditions no longer hold true.”

Note: This was originally published at Gigaom, where I was a senior writer from 2010 to 2015. The site still exists but the archive is gone.

Continue reading “The Tow Center report”

Facebook’s initial public offering is one of the most eagerly anticipated technology IPOs since Google went public in 2004: It is a launch that values the social network at more than $100 billion, and it has sparked a number of debates about the future of the company, including whether social advertising is effective or not and whether the company is failing to take advantage of mobile properly. But there is another issue investors should be concerned about when they look at Facebook, and it is arguably even more important than any of these operational questions: namely, the iron grip co-founder and CEO Mark Zuckerberg has over the shares of the company.

For someone who only just turned 28, Zuckerberg wields an almost unprecedented amount of power over the fate of Facebook — not just over the votes that go along with shares of the company but also over the board of directors. The secret to this tight grip is buried in the history of the social network and in particular in the advice Zuckerberg received from former Napster founder Sean Parker, who was a mentor to the Facebook founder and at one time was president of the social network. The implications of what he helped Zuckerberg construct are profound and create a substantial investment risk.

Sean Parker helped Zuckerberg take control of the company

Long before Facebook became the giant it is today, with almost a billion users and revenue of more than $2 billion, Parker advised its young CEO that he should do everything he could to hang onto control of his company. This advice was based on Parker’s own experiences at Napster and another company called Plaxo, where he was removed by the board. So when Facebook took its initial funding round in 2005, he convinced Zuckerberg to push for control over two seats on the board of directors. And when Parker left the company that same year (after some bad publicity over a drug charge), he gave Zuckerberg his seat as well.

That gave the Facebook CEO control over three of the company’s five board seats. But that was just the beginning: In 2009, the board (which he controls) created a new class of “super-voting” shares that have 10 votes per share, compared with the single vote normal shares have. Through his ownership of a chunk of these super-voting shares, Zuckerberg controls almost 30 percent of the votes in the company. Plus, he has proxy agreements with a number of other shareholders, including co-founder Dustin Moskovitz, that give him control over their shares as well.

In all, these various arrangements give the Facebook CEO control over the board of directors and about 58 percent of the votes in the company. If Zuckerberg decides to do something, he doesn’t even have to ask for permission from the board or put it to a shareholder vote (or if he does the latter, he knows he can prevail). Investors got a tangible example of what this means last month, when Facebook announced it would be acquiring the hot mobile photo-sharing service Instagram for $1 billion. According to a number of reports, Zuckerberg told the board of directors about this billion-dollar deal later — via email.

Super-voting shares are popular, but are they wise?

The visionary founder who controls the progress of the company he founded with an iron fist has become a Silicon Valley archetype, thanks in large part to Apple CEO Steve Jobs, who was famously ejected from the company he co-founded due to his erratic behavior. He returned later to rescue Apple from certain disaster and transform it into one of the most valuable companies in history, giving every startup founder a reason why he too should be allowed to control every aspect of his company, regardless of things like shareholder rights.

Google also helped popularize the idea of multiple-voting shares, which gave co-founders Larry Page and Sergey Brin and former CEO Eric Schmidt effective control over the company. In Google’s offering prospectus when it went public in 2004, the co-founders argued this kind of arrangement was necessary in order to ensure Google remained true to their long-term vision rather than getting sidetracked by questions of short-term financial value.

A number of other tech companies have chosen this same route, including both LinkedIn and Zynga. They have also made the argument that dual-class shares are necessary to protect the company and its vision from the vagaries of the daily stock market. (What many of these companies don’t say is that such structures also make it a lot harder to acquire the company, something that has made multiple-voting shares popular with media companies such as the New York Times and Washington Post.)

Multiple-voting shares are a double-edged sword

So why should investors be wary of multiple-voting shares? Because while they protect the long-term vision of the founders of a company, they can also protect the founders from the kind of shareholder action that is often necessary when a company loses its way. Yahoo and AOL, for example, have both been the target of lobbying efforts by activist shareholders who argue they have been mismanaged and that their share price has been damaged. If either AOL or Yahoo had provisions like Facebook does, there would be no hope of ever changing anything at either company.

As a number of shareholder-rights groups and activists pointed out in advance of Facebook’s IPO, tapping the public markets for funding is supposed to bring with it certain responsibilities on the part of corporate executives — including a duty to be answerable to common shareholders and for any failure to act in the best interests of those investors. If companies don’t want to abide by those rules, the argument goes, they should remain private and seek funding from banks or private venture-capital groups.

In a recent report about Facebook’s voting structure, the activist group Institutional Shareholder Services said the dual-class structure is “an autocratic model of governance” that makes Facebook “less viable than a competitor whose governance gives owners a voice proportionate to the economics they have at risk.” The group also criticized the growing trend for such super-voting shares, saying, “Facebook appears to have taken the same outdated dance lessons as many other recent tech sector debutantes.”

Having Zuckerberg control 58 percent of the votes at Facebook isn’t likely to be a problem for anyone as long as the company is making smart decisions about what to do with its money and as long as the stock price is going up. But if it starts to go south and Facebook makes some unwise decisions, it will become obvious that such voting structures are a fair-weather friend: They are great to have when things are going well, but they can become a huge liability.

Before Steve Jobs had even passed away, people had already started playing the “who is the next Steve Jobs” game — trying to come up with names of technology and design visionaries who might be able to don the mantle of the Apple co-founder and CEO. Jeff Bezos of Amazon? Napster and Spotify founder Sean Parker? Those names and others have been floated by industry watchers, but listening to Twitter and Square founder Jack Dorsey at GigaOM’s RoadMap conference on Thursday made me think that he is at least as strong a contender for that mantle (if such a thing even exists) as any of them. Could Dorsey change the way we interact with technology and the world around us in as profound a way as Jobs?

Why do we even need an heir to Steve Jobs? The obvious answer is that we don’t. Jobs was unique, in both positive and negative ways, and the precise combination of those features made him who he was and thus made Apple what it was. No one is going to be the next Steve Jobs because they will have a different combination of strengths and weaknesses, and they may not be as lucky or as smart in specific ways. But when it comes to the role that Jobs played in technology — the role of visionary designer, creator, instigator and disruptor — we need those people more than ever, because visionaries inspire others, even if the things they do themselves don’t always succeed. They change the way we look at the world in fundamental ways.

I haven’t spent a lot of time around Jack Dorsey, but based on his conversation with Om at RoadMap, he clearly spends a lot of time thinking about the big picture behind the technology that he is involved in. So it’s not just about Twitter and how it works — or what it looks like or even how to monetize it — but how it connects us to our own “humanness” as he put it, and enables us to experience things and see through the eyes of others. He described how he found this an incredibly powerful thing during the protests in Iran, and I think others have had a similar response to the events of the Arab Spring and the earthquakes in Japan and Haiti.

And when it comes to Square — the other company that Dorsey is helping to shape and create — it’s not just making payments easier or more efficient that interests him, but how making that easier can help artisans and individuals become fully functioning businesses more easily, and how that could help change society.

Dorsey’s roles with two very different companies have also sparked some comparisons to Jobs, who helped revolutionize animated films with Pixar while also changing the personal electronics industry at Apple (the differences between Square and Twitter are arguably even more dramatic than Pixar and Apple, since Square is a device that people pay for and Twitter is a service). And Dorsey was also forced out of the company he founded, much like Jobs was — after a dispute with former CEO Evan Williams, who funded the company in its early years — and then returned to become the product visionary.

One of the things that is very different about Dorsey and Twitter stems from the fact that Twitter is a service rather than a product. Under Steve Jobs, Apple excelled at product design, but it has been notoriously inept at anything service related: iTunes, to take just one example, is a total mess when it comes to usability and design despite years of evolution, and things like Ping have effectively been stillborn. One of the most powerful things about Twitter, however, is the way in which the service was transformed by its users, with additions like the @ mention and the retweet — features that were never even imagined by its creators. Steve Jobs, by contrast, wouldn’t even let people replace the battery in his products.

From what I can tell, Dorsey also seems to be missing what could charitably be called the “difficult” elements of Jobs’ personality (other people have more blunt terms for it), which are detailed in Walter Isaacson’s biography: the shouting, the merciless humiliation, the ruthlessness even with friends, the crying in meetings, and so on. One of the questions that this description of Jobs raised for me is whether those things were a necessary part of his success as a visionary and designer, or were they simply character flaws? Would Apple products have been the same, or been as revolutionary, if he were a different kind of person.

So is Jack Dorsey the new Steve Jobs? Probably not. But that said, he clearly has a vision about two fairly significant areas of the technology sphere — the way in which even a simple service like Twitter can change the way we interact with each other and distribute information in a digital and connected world, and the way a simple payment service like Square can potentially transform entrepreneurialism and small businesses. And he is thoughtful about the implications of those things in a way that many product or business-focused technology executives are not (he even has a fascination with the application of Zen Buddhist principles to design, as Steve Jobs did).

Dorsey has already altered the media landscape with Twitter — whether he knew that was what he was doing or not. And he is trying to alter the payment landscape as well with Square, which could ultimately help make it easier for entrepreneurs and small businesses to get paid. Whether those changes will be as massive and transformational as the ones Jobs unleashed remains to be seen, but we could definitely use more visionaries.

A decade ago, Microsoft finally settled a long-running antitrust case that was launched against the software giant by the Department of Justice, based on accusations that the company was using its monopoly on computer operating systems to crush competitors. Now it is Google’s turn to face the antitrust spotlight: Although it is not the subject of a formal government case yet, the search behemoth is involved in an official inquiry by the Federal Trade Commission, which is investigating whether Google is distorting the market for web search and search-related advertising.

What makes this case more difficult than the one against Microsoft — and ultimately a lot harder to prove — is the question of what a monopoly even means in the age of the web, when the browser has taken over from the operating system as the primary way in which we use our computers and mobile devices. Does Google have a monopoly in any real sense? And if it does, can it be shown that the company is using that position unfairly, causing harm either to competitors and/or to consumers of web services?

Critics of the company argue that both of these things are true. And the list of Google’s enemies is a fairly long one, including fellow giants like Microsoft — one of the main proponents of the antitrust allegations, somewhat ironically — as well as large web services like Expedia and the recommendation service Yelp, who argue that Google is giving its own competing services preferential treatment and thereby distorting the market. And Google isn’t just facing antitrust inquiries in the U.S.: It is also under investigation in several European countries for similar alleged offences.

A monopoly on search and search-related ads

The charges being leveled at Google are twofold. One is that it has a monopoly on search and on search-related advertising and that this gives it an unreasonable amount of control over how content is found online — since search is the primary way that many people discover websites and services — as well as an ocean of cash from search-related advertising. The second allegation is that Google uses the money from its advertising monopoly to develop or buy services that compete with those from other companies and that it then uses its control over search to give those services preferential treatment in its search results, which provides an unfair advantage.

So in the case of Yelp, whose founder and CEO, Jeremy Stoppelman, testified in a recent Senate hearing regarding Google’s behavior (which wasn’t part of the official FTC investigation but raised many of the same issues), the claim is that when Google couldn’t acquire the company for its local recommendations, it first tried to steal Yelp’s content and use it without asking, threatened to remove Yelp from Google’s search results altogether and then bought a competing service called Zagat.

This effectively pulls in all the different aspects of the antitrust case against Google, to the extent that there is a case: the use of its giant cash reserves to try and take over Yelp; the “scraping” of Yelp’s content for use in Google’s own local service, Google Places; the pressure on Yelp to play by Google’s rules or face deletion from its all-powerful search index; and finally, the acquisition of a competitor, to which Google is allegedly giving preferential treatment in its search results. Expedia made similar allegations about Google following its purchase of ITA, which provides travel-related information that is used by Expedia and other services (a deal that was reviewed by the FTC).

Having a monopoly isn’t enough for antitrust

As I tried to explain in a recent GigaOM post, antitrust law in the U.S. doesn’t make having a monopoly in a particular market illegal. What the Sherman Act is designed to fight are monopolies that have been achieved through illegal means (i.e., collusion or restraint of trade) and/or monopolies that are being used to harm a particular sector. But it’s even more complex than that. Unfortunately for Yelp and Google’s other critics, it’s not enough just to show that a company with a dominant market position is being unfair to its competitors. It has to be proven that being unfair has some tangible impact on the market, either by restricting choice or raising prices or both.

So Yelp might argue that Google is being unfair by a) taking its content without asking and b) giving its own Zagat results a higher ranking in search (assuming it can even be shown that Google is doing this). But does Google’s behavior have any impact apart from being unfair to Yelp? Does it restrict consumer choice when it comes to recommendations services in any real way? And if it does, will consumers have to pay more for those services? Similar questions would have to be asked about Google’s dominance in search itself or search-related advertising. Does that dominance affect consumers in a tangible way?

Thomas Barnett, the former head of the Justice Department’s antitrust division, argued in a presentation to the Senate committee that Google’s control over search-related ads would lead to higher prices for those ads and that consumers would pay more because the companies buying those ads would inevitably pass those higher costs on to their customers. But this is not obvious at all. Even if someone could prove that prices for search ads are higher than they should be (whatever that means), an antitrust case would then also have to prove that companies were passing those costs on instead of just absorbing them.

One of Barnett’s counterparts, a former antitrust specialist with the New York attorney’s office who worked on the Microsoft case, argues that Google simply doesn’t fit the description of an illegal monopolist in the same way that Microsoft did. One of the main reasons for this is that Google provides a web service that is free to anyone and that has multiple well-funded competitors (including Microsoft itself). Users are not forced to search in Google, nor are they forced in any real sense to pick Zagat’s reviews over Yelp’s, or Google Travel’s results over those from Expedia or Travelocity.

Dominant web players rarely last long

I’ve argued before that one of the most powerful arguments against a federal antitrust case against Google is that such investigations rarely have much impact, in many cases because they drag on too long and involve so much complicated testimony that is difficult to prove. Also, the market for technology itself usually does a good enough job of destroying or disrupting monopolies without the government’s help. A research paper that looked at several high-profile cases, including Microsoft’s and AT&T’s, came to a similar conclusion. In almost every case, technological change had more of a tangible effect than any government investigation or penalty did.

Google, for example, is under significant pressure from the socialization of the web. The way that people find content and services is being altered by the popularity of social networks like Facebook and Twitter — to the point where search may no longer be the primary way that people find new services. Google is trying to take advantage of that phenomenon by building its own Google+ network, and by adding “+1” recommendation features to its search. But will this be enough? It’s entirely possible that Facebook’s social search (which is currently powered by a partnership with Microsoft) could become a significant competitor to Google.

If and when Google does wind up testifying to the Federal Trade Commission or the Department of Justice, it might even argue that Facebook is the real threat — due to its control over the social-networking market, its refusal to release data to competitors such as Google and its powerful relationships with Microsoft, Skype and other competing services. That might seem like a legal gambit, but there is a lot of truth to it as well. The web is still changing so quickly that even a seemingly unassailable monopoly like Google’s could be over before the government gets around to investigating it.