Google: Still Kicking Ass

It's good to be Google's (GOOG) CEO. Among other things, universities beg you to deliver the season's commencement address. This year, Eric Schmidt sauntered up to the stage at the University of Pennsylvania, where he alternated between trite homilies and mild banter—in other words, gave a commencement address. Schmidt told the assembled students to turn off their computers and assorted devices, walk away from their anal five-year plans, connect with other human beings, and nourish the child within. Along the way, he made with the yuks about how kids these days obsessively post every detail of their lives online. "I'm so happy my record of misachievements isn't around for posterity," he said, according to the Philly Daily News. "I'm looking forward for yours to be there for many years."

Why is Schmidt feeling so fine? It might have something to do with the new comScore numbers, which were just released yesterday. If you can believe it, Google's numbers got even better; 64.2 percent of all American searches were conducted with Google, up from 63.7 percent in comScore's previous reckoning. Yahoo (YHOO) and Microsoft (MSFT) dropped, of course, by one-tenth of a percentage apiece; Yahoo has hit 20.4 percent, while Microsoft fell to 8.2 percent.

All this overwhelming success has prompted the New York Times to run its own version of the "Will the government ever stop Google?" story. You know the drill by now: There's a new sheriff in town over at Justice, and he's taking a much different approach to antitrust issues than his predecessors. With Google facing two minor antitrust investigations into its book search service and Schmidt's seat on Apple's board, will the company finally face serious Justice Department action?

The answer: probably not. Google has to leverage its ubiquity to stifle competition, and doing so has to hurt consumers, before the government moves in. While its overwhelming dominance in search is troubling for advertisers, the company hasn't shown the sort of bullying that got Microsoft in trouble. "You've got to be big, and you have to be bad," law professor Andrew Gavil told the Times. "You have to be both."

What the government will do is watch the company like a hawk from now on. Google will be under new pressure to be on its best behavior; it can use Chrome or Orkut of Google Profiles to penetrate new markets, but if it uses its search dominance to squeeze people out of the market, watch out. Don't be evil: It's not just a good idea—it's the law.