Thread by @jason_kint

ok...USA v Google Day One 1am dump. On a positive, I was able to be in-person for every minute. Thrilled as it's the only way I could capture my 8 pages of notes. I'm going to focus on items of interest I think others might miss starting with 1st witness then work backward. /1

So witness one, Google chief economist, Hal Varian. The news headlines will be the memos and emails, we can get to that. But my personal takeaway was Varian, although a legend in academia, also has a significant role to try to minimize antitrust risk for Google. Ironic enough. /2

We saw emails likely being used to show Google considered its search market to include only Yahoo and Bing/MSN but we also saw Varian warning and coaching employees on avoiding the term "market share." Lots of Google warnings about what they say publicly and privately. Hmm. /3

We saw emails around Bing/Y deal providing a look into G's offensive PR machine at work. G offered up Varian for a Q&A with CNET (Tom Krazit) where he used a hyperbolic statement to send a message, "search scale is bogus." /4

It was interesting to see G's execs fret over a mostly unedited Q&A suggesting they wouldn't reach out to Krazit in future (like FB, G plays access games w/ press). But then they relaxed as target msg made it to other outlets, including google chronicler, searchengineland. /5

The "I don’t think I’ll be reaching out to Tom in the future” section also got some laughs as G's legal eagles objected to an unedited Q&A with a journalist as "hearsay" but then it was pointed out that Varian's email said he wished it was edited. /6

my read is Varian was sent out externally to deliver a msg downplaying scale and data (for antitrust reasons). He got his public headlines. But then we were able to see an extensive internal debate w. head of search flat out disagreeing with Varian's external statements. /7

In that episode, we also saw Marissa Mayer disagree siding with head of search (Udi). I caught in email, "Adam K is talking to him" which presumably is Adam now at Chamber of Progress who would also be concerned about any senior execs questioning downplaying of scale/data. /8

And the entire episode was capped when G's Chief Scientist was later quoted saying, "we don't have better algorithms, we just have more data." Including email from Varian, "groan," to an internal email group titled "invisible-hands" which sounds like a black ops address. /9

to the DOJ's case, we saw a 2003 "Power of Defaults" memo from Varian laying out defensive strategy to raise switching costs that he then shared in 2006 with an employee who came back 9 months later with a deck to do just this (which Varian seemed to love).
Pretty damaging. /10

Strategy included 'weaponizing' the default homepage as it was a vulnerability point for Yahoo and Bing, their "achilles heels." Deck showed being default homepage raised searches 15%+ while almost all product changes barely move needle 2%. DOJ laid foundation for defaults. /11

It also got at Google's strategy. Leverage data harvesting across users' full digital life and entirety of the web. We saw a response that when Facebook grows, Google grows. Basically Google rides the growth of the full web. LOVED how much DOJ leaned into data+antitrust. /12

Helpful to see emails of Varian seemingly arguing against the economic value of navigational traffic through Google saying, "WRT the value of our product, specifically search, if Google were to disappear people would switch to Bing." Why does this matter? Two reasons. /13

One. Email was Feb 2021. I would bet a sandwich it was in response to work being done by Google's trade group, IAB, as they created their Oct 2021 report on the internet economy and Varian was saying you can include economic value of search ads but not the navigational stuff. /14

Two. Google's key argument against news bargaining codes in Australia, Canada, et al has been the value they create through search traffic. Here was their chief economist downplaying value of it saying, meh, if we (google) go away then that traffic just goes through Bing. /15

In terms of the opening statement by DOJ, I'm sure that will be thoroughly covered but I did enjoy the title, "What *DID* Google Do?" Considering one of Google's biggest advocates in academia wrote an infamous book, "What would Google do?" it was quite a perfect title. /16

We saw a tease as to rules in Google's billion $ deal w/ Apple. One rule said Apple can't turn on private browsing by default. I wrote in my notes someone else's statement that “If google sets the rules, it will always be to their advantage.” Very true imho. /17

Although Google argues the Apple deal wasn't exclusive, DOJ shared a message that went to apple during renewal negotiations that said essentially if Apple gave consumers choice of their default then they wouldn't get their billions in revenue sharing. Ouch. /18

DOJ used the phrase, "manipulating pricing knobs," which I also noted in their pretrial filing. This relates to Google's alleged ability to turn dials to increase revenues, queries, etc at a cost to the experience/consumers and advertisers' prices. /19