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Antitrust and the Rights of Waze

Antitrust and the Rights of Waze

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July 5, 2013

You can’t turn your back on the FTC.

While I was busy preparing for the Atlas Summit, the Federal Trade Commission found a new opportunity to make trouble for productive people. The people who’d been building Waze, a mapmaking and navigation service that draws on real-time contributions from its users, had sold it to Google for $1 billion—and the FTC told Google it wanted to examine the matter under antitrust law . This could ultimately lead to a demand that Google unwind the deal, which has already closed.

It’s natural to see this as yet another attack on Google . That great benefactor of basically all of us bought some technology it thought would help it provide even better services , and here comes the government—not to mention the “consumer advocates” —to get in the way.

But the basis of an antitrust attack on the acquisition would be that it would diminish the benefits consumers get from competition. In fact, Waze’s CEO, Noam Bardin, publicly claimed that his company was Google’s “only reasonable competition” in maps, and he argued (reasonably) that map search on a smartphone has the central role that web search has on a desktop computer.

Now, I expect that Google bought Waze in order to exploit its technology and provide better services to users. But let’s consider the worst-case scenario. Suppose Google bought Waze just to take the latter’s technology off the market altogether and thereby protect Google Maps from competition. There are two words that would still need to be said:

So what?!

Waze belonged to the people who invested their effort and their money (the product of effort) in it in exchange for a share in its ownership. If they sold it to Google, it was because that was what they thought was best for them. It would be a fine thing if that sale also turned out to be what was best for mobile maps users, but the users have no right to demand that the best interests of Waze’s owners and creators be subordinated to theirs. The people behind Waze created something worth $1 billion. If you would deny them any part of that $1 billion just so that you can keep using their product, you are saying that you have more right to their work than they do—and if the reason is how valuable their product is to you, you are making that claim on them precisely because of the good they have done you .

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