New rules for Google & Co.: Time is energy efficient

“Time is money,” Google search knows. If you enter “Time is …” in the search field, the winged word will automatically appear as the first suggestion of the so-called autocomplete function. Suggestions to complete will save you more typing and save valuable milliseconds. Google also helps save time in other areas, and now displays possible answers to searcher questions using custom fields for more and more topics – whether it’s current football scores, weather forecasts, or a flight search mask.

165 companies and associations against Google

What can be practical and convenient for users is becoming a problem for more and more companies. Because while Google once decided to structure the knowledge of the Internet and lead users to the sites that are most relevant to them, the group is increasingly becoming a central information platform. “The company artificially keeps users at its service and prevents them from visiting other, more relevant services,” 165 associations and companies such as Stepstone, Flixbus and complained in a letter to EU Competition Commissioner Margrethe Vestager.

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“Google is taking an important time for our customers and is increasingly penetrating the tourism industry,” complains co-founder Johannes Reck, head of Getyourguide. The start-up provides travel guides or museum tickets for the holidays. However, Google is already experimenting with a similar offer and showing possible activities for holiday destinations. Reck fears that he will be excluded or that he will have to pay more and more money for advertising in order to continue to be adequately taken into account by Google. The group also powers other German providers, such as Trivago or Holidaycheck, and even the industrial giants and Expedia, which are among Google’s largest customers with annual billions in advertising spending.

Until now, competition watch dogs have been able to follow this development only because Google offers its services for free, ie it does not create its own business model. However, companies fear that the new features could be monetized later, such as a Google Shopping complaint, that they would have to pay to appear in the results fields. “We’ve seen this approach for ten years,” says Reck. “It has to be regulated now, otherwise it will be too late when companies are pushed out of the market again.”

Time as an indicator of market power?

To prevent this, the founder proposes that antitrust authorities define market power using a new criterion. “In a data economy, it’s no longer enough to examine what revenue a company is making,” says Reck. Instead, the time that users actively spend on platforms and services needs to be taken into account.

This idea has been discussed for some time and could soon be incorporated into German competition law. The Act against Restrictions of Competition is currently being revised and the so-called GWB Amendment, which takes into account user time, is also being examined. “Active use is a criterion that suits many guardians,” says Hansj√∂rg Durz, CSU’s spokesman for digital policy.

A hearing of the Bundestag in the Economic Committee took place on Wednesday. Anselm Rodenhausen, Zalando’s antitrust lawyer, was also invited as an expert. This group has long advocated this concept and suggests that “Total Consumer Time (TCT)” be taken into account in key paragraph 19a as a criterion for determining its predominance in the market.

Many digital platforms still measure users’ times and sometimes even display them in their annual reports. According to Zaland, this could be an early indicator of market power, which is not yet visible in sales or market share. For example, many social networks would gain users and their attention before successfully monetizing them. User time is a key success factor, especially for offers that are funded primarily by advertising.

“Many of the features and effects of digital products that we discuss politically and socially are also due to optimization over time,” Rodenhausen explained. An example of this is filter bubbles. “They were created because it was found that when people see content they like and have seen before, it stays on the platform longer.”

“Probably the most important currency in the platform market, especially for advertising-funded digital offerings, is the attention of users,” explains the Federal Association of German Start-ups. The proportion of time a user spends on a bid or within the dominant player’s ecosystem is therefore “a good indicator of monopoly trends in this market”. In addition, this factor could encourage distortions of competition, as dominant companies divert the user’s attention to their own, other offers. “In this way, market power can manifest and expand in all markets.”

Monitoring Netflix shouldn’t matter

This idea is now also being politically examined, but there are still a number of reservations. “You should think about it, but I’m still skeptical,” says Falko Mohrs (SPD). In the case of social networks, the user’s time would be a suitable indicator, but elsewhere it could be counterproductive, the MP fears. “Users spend little time in application stores, but there are still two dominant guardians.”

Expert CSU Durz also mentions music and film streaming services, where users spend an above-average amount of time without necessarily being monopolists. “I basically sympathize with this proposal, but I still see many unresolved issues.”

Even the proponents of this idea do not want to limit Netflix’s monitoring hours by antitrust law. This is the active time of the user, they object. “This is a time when a company learns something about a user because they click, scroll or otherwise behave in a way that can be understood,” explains Rodenhausen. When a movie is running or music is being listened to, the company learns nothing because the user does not communicate with the platform during this time. Streaming without ads or at some point even autonomous management would not be included.

Europe is also planning strict rules

There could also be inspirations and additions from Europe. The considerations on the planned Digital Markets Act are being carefully examined. “We will definitely accept good ideas,” says Durz. The “pooling practices” and the “resulting distortions of competition” will be analyzed in detail. In addition, it must be possible to uninstall applications that are not relevant to the basic functions of the device.

But there is not much time left. “The process should be completed before Christmas, if possible,” says Mohrs. Then it is also clear whether competition authorities will take a closer look at how user time becomes market power and money. It can also be replayed, and it will again be a problem in the EU’s digital services law.

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