Morning Coffee Apr 27 2012

Google Faced With Tough Prosecutor in Antitrust Probe

By joseph walker

Google works hard to make its employees feel like they still work at a start-up, despite having 33,000 co-workers (make that 62,000 if the Motorola Mobility acquisition gets finalized). Working on small teams and under a relatively flat management structure, some Googlers may even forget sometimes that they work for a $200 billion multinational corporation.

A glance outside the Googleplex, though, shows that Google is indeed a very large company with large company problems. Yesterday, the Federal Trade Commission announced that it had hired a high-profile prosecutor to its team conducting an antitrust investigation of Google. The announcement provoked anticipation that the government could be moving toward a lawsuit that would be the biggest tangle between regulators and the tech industry since the Microsoft antitrust case 14 years ago, The New York Times reports. The FTC has not yet decided whether to pursue the case.

But the hiring of veteran attorney Beth A. Wilkinson, a former Justice Department prosecutor who helped convict Oklahoma City bomber Timothy McVeigh, "increases the likelihood that there will be a case," one expert tells the Times. The issue at hand is whether Google abuses its status as the world's leading search engine to promote its own products and put competitors at a disadvantage.

Also, yesterday Google agreed to pay a $25,000 fine for obstructing a prior FTC investigation that looked into the company's Street View cars collecting private data from WiFi networks. The FTC said that Google executives "deliberately impeded and delayed" the investigation," The Wall Street Journal reports. Google denies the allegation.

The $25,000 fine, of course, is chump change for Google. The sum is about how much Google earns in one minute, Marketplace reports. A federal antitrust case could be far more costly.

Subtle Strategy (WSJ)

Amazon profits fall by 36% in its most recent quarter to $130 million. But revenue increased by nearly the same amount, 34%, to $13.2 billion. The company is pursuing Jeff Bezos's "crazy like a fox" strategy of forsaking short-term profits for long-term growth. Its staff headcount grew by 16.7% to 65,600, most of it in customer service and operations workers.

New Era (FINS via WSJ)

Defense contractor Lockheed Martin is grappling with an employee strike and a future defined by steep Pentagon budget cuts. They'll have to begin facing those challenges without Chief Executive Bob Stevens, who will step at the end of the year. Meet the new guy, current President Chris Kubasik.

Switching It Up (WSJ)

Your parents told you that constantly changing your mind and going in different directions would get you nowhere. But in Silicon Valley, that's what all the cool kids do, not to mention the most successful ones.

Shrewd Negotiator (VentureBeat)

A new report says that Instagram Chief Executive Kevin Systrom used an acquisition offer in the hundreds of millions from Twitter to get a better offer from Facebook.

No Fun (WSJ)

Zynga lost $85.4 million last quarter, with at least some of it caused by increased compensation costs for employees. At the same time, the company is trying to lessen its dependence on Facebook with acquisitions like that of OMGPOP last month.

Taking Controls (AllThingsD)

Groupon has brought on a veteran technology executive to oversee its internal controls and processes. Kal Raman will take the role of senior vice president of Americas.

Autobiography (AllThingsD)

If you don't already think Jack Dorsey is a dreamy superman, check out this email questionnaire he filled out. The Twitter and Square founder didn't watch TV as a kid, preferring books. Were he not a tech CEO superstar, he'd be wandering around India with a sketchbook. For a more conventional, but no less interesting, look at Dorsey, here's his Charlie Rose appearance from Wednesday. .

Shortage (Tech Europe)

The job market for data scientists is booming, but there's not nearly enough talent to fill demand. One of the toughest parts of the job has nothing to do with math, it's about asking the right questions and being able to tell stories with data. The Obama campaign is giving free data analysis training to volunteers.

Minority View (Reuters)

Here's a dissenting opinion on Marc Andreessen, the famed Netscape founder turned venture capitalist. Andreessen made his fortune selling products that no longer exist to old, stodgy companies with cash to burn, Felix Salmon writes.

Buzz Around the Office

Don't Stop Me Now (YouTube)

A Freddie Mercury tribute from cartoonist Pablo Stanley.

List of the Day: Recognizing a Dysfunctional Boss

We've all had them at some point, and if you haven't, you will.

1. They go hot and cold with their emotions toward you.

2. They're conspiracy theorists.

3. They never admit to a mistake.

(Source: Moneywatch)



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