Shapes of things (5)

The Wall Street Journal seems to have stirred up an interesting and important lawsuit brought by video-sharing service Rumble against the Google/YouTube prong of Big Tech. The Wall Street Journal’s Sam Schechner reports on the lawsuit in “Google Sued by YouTube Rival Over Search Rankings.” Subhead: “Video-sharing site Rumble, citing a Wall Street Journal investigation, alleges Google diverted traffic away from it toward YouTube.” Schechner reports:

Video-sharing site Rumble Inc. accused Google in a lawsuit of abusing the power of its search engine and mobile operating system to boost its YouTube video service over rivals, the latest allegation of anticompetitive conduct against the Alphabet Inc. unit.

Toronto-based Rumble, which has become popular among conservative pundits, on Monday filed an antitrust suit in federal court in California arguing that Google is “unfairly rigging its search algorithms” to place YouTube above Rumble in its search results. Rumble said Google’s behavior cost it significant numbers of viewers and advertising dollars.

The lawsuit also argues that Google’s deals to pre-install a YouTube app on mobile devices running Google’s Android operating system have unfairly deprived Rumble of viewers.

“Google, through its search engine, was able to wrongfully divert massive traffic to YouTube, depriving Rumble of the additional traffic, users, uploads, brand awareness and revenue it would have otherwise received,” the lawsuit states.

Google blows off the lawsuit. Schechner turns to the Journal’s role in its genesis:

Rumble’s lawsuit cites the findings of a Wall Street Journal investigation from July that found Google’s search results gave a preference to YouTube links over those from video rivals. In a series of tests, the Journal found that search results in a large majority of cases featured YouTube videos ahead of the same or very similar versions of the videos available on competitor sites.

Rumble wasn’t featured in the Journal testing, but the video-sharing company says in its lawsuit that it conducted its own similar tests using its videos. One exhibit in the lawsuit includes screen shots of a Google search for “funny dogs on rumble” which returns a list of videos that are entirely from YouTube.

Google blew off the Journal as well. Schechner recalls:

In response to the Journal report, a Google spokeswoman said in July that no preference is given to YouTube or any other video provider in Google search, but declined to comment on the specific examples. “Our systems use a number of signals from the web to understand what results people find most relevant and helpful for a given query,” the spokeswoman said at the time.

Rumble introduces a Kafkaesque twist in the Google/YouTube scenario:

Rumble says one of its main business models is allowing content creators to license their videos exclusively to Rumble, which then syndicates them to other video services, including YouTube and Microsoft Corp.’s MSN. Rumble then pays the posters a share of the advertising revenue those videos garner.

Rumble says it must syndicate its videos to YouTube in order to survive, because of the “monopoly Google has obtained for its YouTube platform through its unlawful anti-competitive conduct.”

Schechner’s story concludes with a recitation that bears on Rumble’s damages:

Since 2014, Rumble says, its videos syndicated on YouTube have generated 9.3 billion views, and $4.3 million in revenue. Rumble contends that most, if not all, of those 9.3 billion views would have occurred on the Rumble website had Google not boosted YouTube in search results. Those viewers would have watched and uploaded other videos, too, all of which would have earned better ad rates than on YouTube, Rumble contends.

Cumulatively, Rumble calculates that advertising on the allegedly missing views over that period would have generated “well in excess of $2 billion.”

I believe those damages would be trebled under the antitrust cause of action.
More to come.