Most of us remember when the Clinton administration went after Microsoft in an aggressive anti-trust case.

In 1998, the U.S. Department of Justice filed legal action against Microsoft alleging it was a monopoly that abused it’s market power in the PC market. The chief complaint had to do with Microsoft bundling Internet Explorer with Windows and restricting use of competing browsers on the Windows platform. Microsoft, for it’s part, contended that merging the two products was a natural evolution and that they were tightly integrated. This case ended in settlement and, at the end of the day, not much changed.

Are we close to seeing a rerun? It is certainly possible. This time, the target might very well be Google.

President Obama appointed Christine Varney as the head of the antitrust division at the Justice Department. However, back up to June of 2008, and Varney was publicly declaring Google a problem. "For me, Microsoft is so last century," Varney said. "They are not the problem. I think we are going to continually see a problem, potentially, with Google."

Varney was one of Netscape’s attorneys during the Microsoft case, so she was very much involved with painting Bill Gates as evil incarnate. Now, Varney is suggesting that Google is repeating Microsoft’s bullying, but this time in the world of cloud-computing. She says Google is amassing such enormous market power in the world of web applications that consumers will also be forced into using Google products.

And she seems to be on a mission. In her first speech as an Obama administration member, she said, “In the past, the antitrust division was a leader in its enforcement efforts in technology industries, and I believe we will take this mantle again.”

Google is well known for it’s company mantra “Don’t Be Evil”. The company was formed with a very different mentality than many others. They treat their employees extremely well. The company seems to really go out of it’s way to support the public good and social projects. One could also very easily argue that Google has played a huge role in expanding wealth online to the “little guy” with it’s Adsense program, allowing small-time web publishers to make money.

But recently, Google has been raising eyebrows among some who like to control things. In 2007, regulators got nervous about Google’s plans to acquire DoubleClick. In 2008, the Department of Justice forbid a proposed search-ad deal between Google and Yahoo. The Google book-scanning project has raised legal eyebrows.

Bottom line, Google is huge. However, they got huge because they offer superior products and they did it better than the others. That said, the “hugeness” of Google is attracting eyeballs. Especially as Google works on expanding into areas other than search. Google is actively promoting the idea of a web-based computing environment, one in which the significance of a desktop-bound operating system is very much diminished. In such a world, regulators will be very nervous because Google is in position to more or less control such an online world.

Another issue is data security. Google offers many free services in exchange for the data. When you have your email on Gmail, you’re giving Google access to your address book. When you use Google’s free 411 service, they are using the request to improve voice recognition, which will be used in Google Voice (yet another of Google’s free services that will give Google access to your phone records).

Personally, I think Google is a good company out to do good things. However, in that mission, Google is likely to grow so big that people in regulatory positions might try to take them down a notch.

I am not a lawyer, however it seems to me that a key point is whether consumers have a choice. It seems we do. For example, PCMech’s very own Rich Menga has decided he does not want to use Google services. And guess what – he doesn’t. Except for public services like the search engine and Youtube, Rich does not use any of Google’s applications (that I know of). If any person wants to flat out avoid Google, they could. Those of us who do use Google services do so by choice.

So, is this really a matter of stifling competition?

Or this more a matter of that unfortunate human instinct to strike down those who raise their head above the crowd?

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