Commentary

Google’s Oligarchic Algorithm

By Andrew Lehman

I’ve been running a web development firm since January 1999.  Google and my firm were born a few months from each other.  By chance, I began tracking Google’s rise shortly after its appearance, noting the efficacy of its search perimeters along with that of its competition.

Though Google was a very powerful tool early in its career, that muscular efficiency has diminished.  That seems due to several factors.

Those folks whose job it is to figure out how Google works to achieve higher rankings often performed their job well, depreciating the searches that Google offered.  Corporations able to pay the most money for professional optimizers tended to get the highest rankings.  Google’s results often showed which firms had the most resources to pay for position.  Google’s algorithms could not distinguish value from money.

Still, if you typed in “Chicago photographer,” you got a list of Chicago photographers on the first page, individuals seeking to sell their services to searchers looking for what photographers had to offer.  That is not the case now.

Google decided to go public in 2004.  On November 15, 2004, they enacted the first of several major algorithm changes, pushing many of the optimized sites from top positions, penalizing websites for using techniques that gamed Google’s evaluation algorithm.  The result was an overnight tripling of Google revenues.  Corporations and businesses formerly paying optimizers for high rankings to appear on the first page of a search were forced to pay Google for their ranking, on the right side of the screen, where Google sold ads.

It became in Google’s best interest that searchers looking for commercial products or services NOT find what they were looking for so that the Google advertising section would profit from the click.

It was clear to me that in preparation for going public, Google was actually seeding its searches with inefficiencies in order to encourage profits.  Regarding commercial searches, it’s only got worse with time.  By embedding top 10 positions with Wikipedia entries, videos and other tangentially related content, commercial businesses continue to be pushed into the second page, forced to pay Google for ad space.

I recently read that Google has decided to place a heavier emphasis on “brand” or conventional corporate websites when deciding how to rank.  It is adjusting its algorithm to make it even more difficult for those businesses without deep pockets to achieve rankings.  One could call this the new oligarchic algorithm.

As a small web developer seeking rankings for small, local businesses, I find the decisions that Google has made over the years have been sometimes fair, sometimes selfish, sometimes in between.  The trend has been toward depreciating its mission of providing useful searches in order to make money while encouraging the corporate status quo.

This has been a particular problem for local businesses seeking business using the Google Ad Words program, where Google derives most of its revenue.

The company that would do no evil has little heart.  Google’s attention continues to focus on those larger “brands” or corporations that it sees as peers in a global economic landscape dominated by corporate, controlling interests.  Google encourages the status quo in several ways, using conventions that concentrate wealth with the very few.

Google’s famous algorithm encourages those sites with the most incoming links to rise to the top of rankings.  Google has difficulty judging value outside a context of popularity or the simulated popularity that comes with businesses buying links to their sites to get high rankings.  Google theoretically ranks respect.  What it often only ranks is how much money a business is willing to spend to appear to be getting respect.  Or, it ranks how large a corporation has become, presupposing that respect comes with size.

In the Google universe, each planet or business has size and gravity that can be determined by measuring mass.  Google’s algorithm presupposes that mass, respect as determined by incoming links or established brand, is the only variable that determines gravity.  There is more to respect than popularity or power.  Google has no algorithm for measuring integrity.

Google is losing integrity in the process.

Before Google, the local yellow pages served local businesses by being the place where potential customers would seek local products and services.  The Internet has destroyed the yellow pages.  Local businesses are furious at the costs and poor results with yellow pages.  Local firms are moving over to Google Ad Words as one of the few alternatives that approximates what the yellow pages used to offer.  Some of those local businesses are using the services that some of the yellow pages companies are offering whereby the yellow pages becomes the broker for a local business with Google Ad Words.

Google works out agreements with the yellow pages to allow the yellow pages to act as an agent for a local firm, managing what the local firm spends with Google.  The yellow pages drives traffic to a business’s website off of a Google Ad Words listing managed by the yellow pages.

Typically, a store contracts with the yellow pages for $500 a month to bring it traffic from Google.  Usually that traffic goes to a special page created by the yellow pages that allows it to track exact traffic patterns, even noting the number of phone calls if a dedicated phone line is assigned to appear on that page.  There is no transparency.  The store is not allowed to know how much it is spending on any particular visitor. 

It doesn’t know how much money went to Google or how much to the yellow pages.  The store can form its own division and figure out how much it is paying for each person that showed up on the page, but it has no idea which search phrases are performing and which are not.  It also has no idea what percentage of the $500 is going toward the yellow pages.  Typically, an Ad Words specialist receives 10-20 percent.  There is no transparency.

In addition, the yellow pages often brokers or handles the account for literally all competitors in a region.  Google bases its Ad Words rates on several factors, the most important being how much money is being spent by the business.  With the yellow pages handling many and sometimes all competitor bids, it is not acting in the best interest of the stores it represents by controlling bids to keep the rates low, but the yellow pages is behaving in its own best interest by pushing bids higher to beef up advertising expenditures. 

It is a devastating conflict of interest for the yellow pages to be managing several competitors in a market.  In addition, any local business seeking to buy positions in the Ad Words programs on its own, in those areas that compete with several businesses managed by the yellow pages, ends up paying fees inflated by the yellow pages interventions.

Google, working with the yellow pages to manage this program, takes the low integrity position of siding with the large corporation against the local businesses.  Google and the yellow pages end up making enormous profits because they control the system.  Small business gets screwed.

Will Google be seen as the bad guy when this corporate scam becomes widely known?  I’m thinking likely not.  Most stores I know loathe the yellow pages.  There are several types of yellow pages in many markets.  Not all engage in this practice.  But they’ll all probably be associated with this scandal when it blows.

Andrew Lehman, a regular contributor to The Public Record, operates Andrew Lehman Design, Ltd., a web firm with over 400 clients specializing in local businesses and non profits. He is co-director and founder of the 1100 organization, Peace, Justice and Environment Project. Andrew is on the board of directors of In These Times. He blogs daily at neoteny.org and can be reached at andrew@pjep.org     

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