May 27, 2024

Google Hotels and Google Flights Stir Bipartisan Flack Over Business Practices

Skift Take

The legislation that Senators Elizabeth Warren and Lindsey Graham back will get picked apart by lobbyists. One element that airlines would loathe — it would bar companies from selling the same product at different prices.

Criticism about Google’s allegedly anticompetitive business practices with Google Hotels and Google Flights is going mainstream — and getting bipartisan.

In a New York Times opinion piece, Lindsey Graham and Elizabeth Warren: When It Comes to Big Tech, Enough Is Enough, the two U.S. senators target highly profitable businesses that “suppress competition.” They specifically cite Google, Amazon and Apple.

“Google uses its search engine to give preference to its own products, like Google Hotels and Google Flights, giving it an unfair leg up on competitors,” they wrote.

The commentary is noteworthy for at least two reasons.

First, Google faces several ongoing lawsuits by the U.S. Department of Justice and dozens of states alleging it illegally dominates the search and advertising markets. But Google’s business practices in travel specifically have received far less attention in lawsuits and D.C.

Second, although Graham, a conservative Republican from South Carolina, and Warren, a liberal from Massachusetts, usually support diametrically opposed policies, they have a lot of agreement when it comes to taking on tech. In fact, they are the sponsors of the Digital Consumer Protection Commission Act, which they describe in the essay as providing the “structural” change required to “rein in Big Tech.”

Google’s Business Practices Have Been a Travel Industry Flash Point

The issue of Google biasing its search engine toward its own paid travel products has been a travel industry sore point for many years.

The situation that has many travel companies crying foul: Google has the market-dominating search engine and it tilts search results toward its own products and advertising ecosystem. Results for non-advertisers are lower on the page — or on a second or third screen on mobile.

Many companies, such as Tripadvisor and Trivago, say they have lost customers because of the uneven playing field. Others, such as Expedia and Booking.com, have spent billions of dollars annually on Google advertisements to gain customers.

Here’s the issue that Graham and Warren characterized this week as Google giving preference to Google Hotels, as well as Google Flights, over competitors’ businesses.

If you searched on Google for “New York hotels,” you might see sponsored ads from Expedia and Hotels.com atop the page.

Next, below those advertisements, you can view a large, colorful Google three-pack of hotel listings that dominate the page. It has a map depicting hotels and their nightly rates, as well as hotel listings with photos, star ratings, review counts, and hotel descriptions.

If you click on any of the hotel listings or the hotel rates in the map, you’d navigate to Google Hotels, which is a Google ecosystem where — again — advertisements get preference over free search results.

Below all that are the more simple, free search results from Hotels.com, Expedia, and Booking.com. And yes, more people click on the shiny, dominant three-pack of hotel listings than the boring ones lower down.

Google’s Tilt Toward Its Own Products Is Even More Apparent on Mobile 

These images above are on desktop. On mobile, the bias is even more apparent, because the free links often don’t appear on the first screen; you’ll have to keep scrolling past advertisements to find them on a subsequent screen.

When users click on the prioritized three-pack whether on desktop or mobile, they then navigate to Google Hotels, where Google advertisers get the prime real estate. 

Once the user arrives in Google Hotels (see below), you’ll see advertisements from Booking.com, Expedia, Trivago and Traveluro appear above free search results from the Millennium Hotel New York One UN Plaza and Agoda. Again, advertisements get precedence over listings from companies that show up for free.

We reached out to numerous travel companies about the Graham-Warren opinion piece and the issue of Google giving priority to its own products. Google and Expedia declined to comment, as did Tripadvisor, which cited a quiet period before earnings next week. Warren and Graham’s offices didn’t respond to requests for comment.

Allegiant Air said it doesn’t advertise on Google.

“Allegiant does not list our flights for sale on any third party websites and passengers can only book their vacations at www.allegiant.com,” a spokesperson said. “We do this to keep fares low and provide customers with the most accurate information relating to our flights, procedures, and policies.”

Google has said in the past that it is trying to provide users with the best travel options. It has noted that the listings in the three-pack are generated organically. However, clicking on those featured free links takes users into Google Hotels, where advertisers are given preference over free links.

“Our Digital Consumer Protection Commission Act would create an independent, bipartisan regulator charged with licensing and policing the nation’s biggest tech companies — like Meta, Google and Amazon — to prevent online harm, promote free speech and competition, guard Americans’ privacy and protect national security,” Warren and Graham wrote. “The new watchdog would focus on the unique threats posed by tech giants while strengthening the tools available to the federal agencies and state attorneys general who have authority to regulate Big Tech.”

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