Business

Google vs. Microsoft: The Lobbying Wars

Google may have Microsoft beat in the search innovation game, but Microsoft has more practice in lobbying Congress and knows how the throw its weight around in Washington. Microsoft has been hard at work trying to thwart Google’s proposed search partnership with Yahoo, and it looks as though their experience in DC is coming in […]

Armwrestling

Google may have Microsoft beat in the search innovation game, but Microsoft has more practice in lobbying Congress and knows how the throw its weight around in Washington. Microsoft has been hard at work trying to thwart Google's proposed search partnership with Yahoo, and it looks as though their experience in DC is coming in handy.

Glenn Manishin, a partner in Duane Morris’ antitrust and technology practice, tells Roll Call today that Microsoft isn't so much trying to protect its search business as it is looking to create roadblocks to Google's growth:

“Microsoft’s opposition has very little to do with online advertising and is part of a broader, longer-term strategic battle between two visions of where technology is going to be... I think Microsoft’s concern isn’t directly with the competitive effect of online advertising, because Microsoft doesn’t do a lot of online advertising.”

Another person close to the deal referred to Microsoft's relationship with DoJ as "very close" and says that the company is "pulling out every favor it’s got” to block the deal.

The distinction between the two companies' lobbying skills is an interesting one.

Microsoft spent about $5 million on lobbying in the first half of the year, while Google spent about $1.4 million. But more importantly,
Microsoft knows how to work the phones and get other lobbying groups on their side. In addition to The Association of National Advertisers and the International Association of Advertisers, the mighty American Corn
Growers Association has come out against the deal. (Question: are they getting another ethanol subsidy if the deal fails?)

Google has launched an information campaign, replete with town halls at agencies to prove how the partnership will benefit them, but is their inexperience in the lobbying game hurting their case?

Surely, Google's CEO declaring last month that they would move forward with the deal regardless of the DoJ's decision didn't help their case, and he's since eaten his words on the matter. Google is now waiting patiently for Justice to finish its investigation, and now appears to be offering concessions to sweeten their case.

Google has made a thriving business off of ignoring the status quo, but that doesn't fly in Washington, where who you know is often just as important as what you know.

Photo: Flickr/**fabbio

See Also: