Babbage | Online competition

Searching for answers

By B.C.| PRAGUE

EAGER internet users shun Google in favour of other search engines in China, Russia and South Korea (among others). In countries using the Latin alphabet, however, there is only one place where Google comes second: the Czech Republic.

Seznam.cz (which incorporates the Czech word for list) had 6.2 million real users in December 2013, making it the country's top search site according to NetMonitor, which tracks Czech web traffic. It is used by 93% of those online in the country. Google does not provide data to NetMonitor, but most estimates put the global giant second among the Czech Republic's 10.5 million people.

Founded in 1996, Seznam is actually older than Google. While no longer involved in day-to-day operations, its founder Ivo Lukáčovič still holds 70% of the site's shares (the rest are owned by American investment firms). In 2012, the company generated revenues of around 108m ($148m). Google, in the same year, brought in $50 billion.

In 27 of 28 European Union member states, the Californian giant reigns supreme. Brussels has noticed. Earlier this month, Google and the European Commission settled anti-trust disputes in four crucial areas. In particular, the terms of use for its AdSense product are now settled, as are hierarchy issues concerning Google's display of search results. Those that pay to "promote" their pages with the search engine cannot now expect to dominate non-promoted pages and results offered by other search sites in Google's listings. "We are glad to have now reached an agreement with the European Commission that addresses its competition concerns," wrote Kent Walker, Google's general counsel, in a February 14th blog post.

In actual fact only a minority of concerns have been addressed, and it remains unclear whether search or online advertising competitors might challenge the European Commission pact in the European court system.

While big companies, such as Microsoft, have lined up to challenge Google's market dominance through the lobbying group ICOMP, Seznam's boss thinks differently. "The best regulation is the market itself," says Pavel Zima, general manager of the Czech site. "Google has done a great job to be in their position. Every company had a chance to do the same, but no one did."

But this free market fervour outlines one exception: smart phones.

Mr Zima points to an inconsistency in Google's behaviour towards individual users and brands. While the average Czech consumer has the option to download Seznam applications to a smart phone with a (Google-owned) Android operating system, phone makers are pressured to offer only Google products as standard on new phones (so as not to disrupt their business elsewhere in the world). Samsung must offer GoogleMaps, for example.

Those anxious over Google's Android antics need to remember that "anti-trust law is not to protect competitors, but to protect competition," according to Roman Zagrosek, a Cologne-based attorney specialising in anti-trust law and technology firms.

No doubt Google's brand and product line will continue growing, but Mr Zima says onlookers can "be sure" that his firm will maintain dominance in its own "conservative market". Localised services may make his claims come true.

In addition to search functions, Seznam offers products targeted specifically to the Czech market. Its ties to a daily newspaper, for example, give it the country's most visited news site. Local adverts and job listings also draw people to the site, as do Wednesday broadcasts of Czech films. Mr Zima also touts the Seznam's map program which is updated daily—faster than Google can do with its Czech maps.

This ability to cater to a specific national market advantages Seznam, as web users increasingly seek services that meet local needs. Whether or not the European Commission deems such services to be threatened by Google remains to be seen.




Discover more

And it’s goodnight from us

Why 10, not 9, is better than 8

For Microsoft, Windows 10 is both the end of the line and a new beginning


Future, imperfect and tense

Deadlines in the future are more likely to be met if they are linked to the mind's slippery notions of the present