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Google, the law of the jungle and its serious consequences

Open letter to Julia Holtz, Google's director of competition

Dear Mrs Holtz,

One year ago, our researches revealed that Google has disabled the competition in the European advertising market and in many other markets using a variety of unfair and illegal means. Springer`s CEO Matthias Döpfner has now filed a suit because of the total dependence of his company on Google. And this despite the fact that the media empire is owned by Zanox, the largest European affiliate (advertising) network.

You yourself have explicitly expressed towards me that there is still a fair competition in the European advertising industry. As a managing competition lawyer at Google, you know the sad truth much better than any other. Why do you want to deceive me at this point?

There are many causes for the elimination of effective competition in the European advertising industry. From our researches, we know, for example, that Google has a close connection to the U.S. intelligence agencies, at least since 2004. In that year, Google bought the Keyhole software from the CIA company Q-Tel, named this service Google Earth and developed from it the services Maps and Street View, among others.
Google evil or Google devil?
Moreover, these eight Google robot-companies cooperate with the Pentagon. Officially, it is said that the military-robot get programmed cleanup functions. Since statements from military and intelligence circles, according to experience, belie the public from true facts, one can safely assume that Google is also involved in the development of combat robots.

Political protection due to collaboration with U.S. military and U.S. intelligence

Also unknown to most of the public is the involvement of Google in synthetic biology. In this area, a collaboration with the American military can also be assumed, even though the Pentagon and Google want to give the impression that this is not the case, and Google does not work e.g. on the so-called DARPA super soldier.

A close collaboration with the U.S. military and the U.S. intelligence agencies automatically mean political protection. With this powerful support, Google can enforce its corporate strategies in all markets and by all means, and acts accordingly as we know. In addition, it puts Google in the position to be able to manipulate at will 7 billion people with its technologies and to exert a high degree of control.

And still, you see Google in a fair competition with other companies?

The OECD/G20-Initiative planned a special tax for the digital economy so that even Google has to pay taxes everywhere money is earned. Like everyone else does, regardless of whether dependent of wage or contractor. This initiative is torpedoed with all the power of the U.S. government. This, in turn, is influenced by a substantial degree of lobbyists who are paid by Google. Google also finances the interest group "The Internet Association”.

Its chairman, Michael Beckerman, was previously deputy chief of staff in the committee of the U.S. Congress for Energy and Commerce for 12 years and at the same time personal adviser to Congressman Fred Upton. He, in turn, has been the chairman for many years of the probably most powerful congress committee, where he has a decisive influence on the legislation that relates to Google. Fred Upton is also behind the demand of the U.S. government for a say in the EU data protection reform.

Google funds a variety of lobbyists

Google also funds a variety of lobbyists in Europe. These include, for example, the interest groups Lisbon Council, the European Centre for International Political Economy (ECIPE), American chamber of Commerce to the European Union (AmCham EU), The European Digital Media Association (EDiMA) and the European Internet Foundation (EIF), which all influence the European legislation. More than 99% of all European companies cannot influence the legislation in this way, just like CONTAXE.

Is that not an illegal competitive advantage if Google does not pay taxes, but his competitors do? And, can one actually speak of a functioning power competition in our industry when Google obstructs this competition through unilateral influence?

 
This is also proven by the tax avoidance construct Double Irish With a Dutch Sandwich with which Google pays only a little more than 2% tax on its billions in profits. Here, revenue from Europe, Africa and the Middle East flow initially to Google Ireland Limited, are then passed back through the Google Netherlands Holdings BV to the Google Ireland Holdings, then to be directed to bogus companies in Bermuda. This way, Google deprives the access of local tax offices to profits which were achieved in this country. A number of other U.S. corporations use this questionable control deprivation model too, as well as the European group Ikea.

However, local consumers are damaged by Google twofold. On the one hand by using competitive and illegal business practices, and on the other hand with the avoidance of tax payments. Do you not find this business practice by Google to a great extent immoral, and can you still speak of a real competition between Google and companies like CONTAXE?
Google und das Double Irish with Dutch Sandwich
Google provides website operators with the tracking tool Analytics, with which Internet surfers can be tracked across several websites and their interests and behavior are recorded. This process also called behavioral targeting provides Google with a significant competitive advantage, as higher click-through rates can be achieved through the delivery of personalized advertising.

Competitive advantage by phony order data processing

Online advertising can also be delivered without the creation of behavioral and interest profiles, as it is done, for example, at every billboard, on television and radio, or in print advertising. The context-sensitive delivery of advertising on the Internet, where no users but site contents are captured, just like Google has practiced it exclusively before the purchase of DoubleClick, provides sufficient opportunity to show interest-based advertising campaigns, even if users remain completely anonymous.

In this context, Google conclude an order data processing with site operators to legitimize the transfer of data from the European Union to a third country, like e.g. to the U.S. intelligence agencies.

With this pre-formulated order data processing by Google, the impression to the German legislature is created that not Google is the owner of the tracked data, but the website operator. This website operator, however, does not even gather user data, but only integrates the analytics code, received from Google, into the source code of his website. Therefore, he is by no means the contracting entity, but at best a vicarious agent of Google. If you would follow the grotesque argument that Google was the contractor of data collection with its service Google Analytics and the site operator is to be regarded as a contracting entity - although Google collects the data, transfers and processes it on its server, you could use the same logic and say that every Internet surfer when opening a website, in which a Google Analytics code is integrated, is at the same time the contracting entity for the gathering of its own data.

 

But the crucial question that arises here is: How did Google manage it to obtain the consent of the Hamburg Data Protection Authority for such a phony order data processing, despite the fact that an effective legal relationship is to be excluded for the purposes of processing data?
Political Corruption
CONTAXE has followed the ranking of Google search engine over a period of more than 5 years using the example of a website. It was found that Google manipulates search results as desired and the use on one valid algorithm for all sites is completely untrue. While users of the Google search engine expect that search results are displayed by relevance, Google manipulates its search results at will having in mind its own commercial interests and favors and disadvantage even individual websites arbitrarily wherever it is profitable for Google or Google affiliates.

Google does not even deny that, but commissions the study First Amendment Protection for Search Engine Search Results in the USA for the corresponding charges, which should prove that Google has the right to do this, according to the First Amendment to the Constitution of the United States.

Manipulation of search results is on the expense of websites with CONTAXE advertising

The study financed by Google comes to the outrageous conclusion that within the meaning of the first Amendment to the Constitution of the United States it would be contradictory to the freedom of speech and of the press, if Google was not allowed to list search results subjectively. The facts that Google is dominant with a market share of 90 % or more, and that therefore competition law standards must be observed, are concealed by the study.

Even the layman quickly realizes how grotesque the justification of Google is when he reads this First Amendment to the Constitution of the United States. It says:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

 

While Google manipulates search results, ie not compiles them in a transparent way using fair points for all market participants, website operators are asked in the so-called quality guidelines (the Google Webmaster Guidelines) not to deceive users and do not use tricks to improve the search engine rankings of their websites. The desperate efforts of website operators to persist in Google are like the battle of David and Goliath. However, in a variant in which David must play fair, while Goliath on the contrary may apply a variety of dirty tricks.

Websites with CONTAXE advertising, particularly those with InText-advertising, were also disadvantaged by Google for years, which is why many website owners have removed the banner codes. The most insidious thing about it was that Google could trust that CONTAXE did not make this manipulation public, because then no one would have registered on the advertising platform.

Endlos list of unlawful business practices

Does this correspond to the ideas of a free and fair competition in the online advertising industry?

The list of competition and thus unlawful business practices by Google, which had a direct or indirect impact on the business operations of CONTAXE, seems endless. In addition to the

 

  • Linking of more than 100 Google services with its market-dominant search engine,

  • Cross- subsidization and bundling of services,

  • Forwarding and control of Internet traffic by building additional infrastructure services, like Android, Google Chrome and Google DNS, among others

  • Direct manipulation of search results of “Money-Keywords” favoring its own services and preferred cooperation partners and customers,

  • Regulation of website operators in the refinancing of websites with other ad programs,

  • Enforcement of Google Account openings for an easier collection of personal data,

  • Linkage of its search engine advertising on a platform with advertising on sites in the Google Display Network, as well as with advertising on mobile devices,

  • Binding and control of mobile advertising by the mandatory use of the Google operating system Android, Google Play. Maps, as well as other Google services on smartphones,

  • Disadvantaging of websites with CONTAXE advertising,

  • Exclusion of competitors by cooperating with selected competitors on proprietary technology platforms,

 

we have submitted many other objections to the antitrust authorities. However, particularly shabby is the fact that Google has co-financed the dubious business model Adblock Plus with tens of millions in a significant way. With this model, CONTAXE online advertising on websites on at least 15 million computers in Germany, Austria and Switzerland was blocked over the years, while Google advertising was displayed.

 

Is this how the functioning competition from the perspective of Google looks like?
Greedy behavier of Google
Today is a particularly sad day for the initiators, employees, business partners and customers of CONTAXE. Also and especially for those who have developed our innovative technologies. We have fought very long against the destruction of our business model. But against the immeasurable greed, which is obviously the most important drive for the ruthless business practices of Google, CONTAXE has nothing to counterbalance.

CONTAXE survival impossible without cooperation with or protection from Google

About 10 years of work, for individuals often 7 days a week, waiving on vacation, acceptance of a modest wage, were too less. And this despite the fact that CONTAXE offers an advertising platform,

 

  • which multi-functionality is unique,

  • where the low cost of ownership is a key competitive advantage,

  • which technology is highly scalable, and has demonstrated a reliability of 100% since its implementation in July 2007,

  • which provides high safety standards to avoid clicking manipulation,

  • which has a basically high acceptance among users,

 

it has not been possible without a cooperation with or protection by Google to bind advertisers and website operators in the long term to the platform. A cooperation as well as protection were not allowed by Google. If the media company Axel Springer with the largest advertising network in Europe after Google is not viable without Google campaigns – how should CONTAXE possibly survive?

An overworked and indifferent as well as partly corrupted politic in Europe has permitted that only the law of the jungle applies in the business areas in which Google is involved. This applies also and especially in the advertising industry.

Law of the jungle practiced by Google increases powerlessness

I do not mind my personal deprivations in recent years too much, but the powerlessness that I feel due to the fact that the law of the jungle practiced by Google does not take place at eye level. Therefore, you can convey the following message from me to the three kind Sirs Eric Schmidt, Larry Page and Sergey Brin:

I do not believe in violence, but I would really enjoy to punch the three in the face. Perhaps then, these men finally understand the damage that they caused CONTAXE and others since many years with their company Google. This should be, of course, in an official fight in a boxing ring, so that everything is done fairly and as many people as possible can watch. Maybe one can even find a sponsor for this.

 

Eric E. Schmidt is an old lad like me, but Larry Page and Sergey Brin are 15 years younger and would have a great advantage. And yet, they could fight me individually or all three at once. I would not care. But I suspect that the three kind Sirs are too cowardly, because one can live very comfortably behind the broad backs of the U.S. administration and its intelligence agencies.

I ask you to forgive my frank words, but I feel committed to our customers and shareholders. I would do everything humanly possible for them and would be up to the aforementioned fight, if CONTAXE can not be sold in the upcoming Ebay-auction, despite the moderate price. After all, if this happens, about 20,000 partners and shareholders of CONTAXE would be damaged.

You, Mrs. Holtz, informed me in one of your last letters that there is no shortage of buyers in the successful European advertising industry. I hope for the above mentioned 20,000 that this statement is no lie, and the Ebay-auction will prove the opposite.

Kind regards
Matthias Hofmann

(Images inside  this Post can be used for reporting about CONTAXE)

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