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Google’s “yeah, whatever” advantage

The antitrust suit filed against Google by the US Department of Justice this week contains echoes of the government’s case against Microsoft 22 years ago, but it will hinge on the ways in which the two cases are different.

Google’s defense will include its longstanding mantra that “competition is only a click away”—or, as the company said in a statement, “you can easily download your choice of apps or change your default settings in a matter of seconds—faster than you can walk to another aisle in the grocery store.”

Microsoft couldn’t say that. If the Windows operating system was driving you crazy, you couldn’t switch to the Mac OS, the top competitor at the time, without buying a new (and expensive) computer. By contrast, Google’s far lower “switching costs” are a central reason why some experts reject the idea of Google as “the new Microsoft.”

But proving that competition is a click away is not the same thing as proving that a market is competitive. For competition to work well, consumers need to be able and willing to switch to better products, and new competitors need to be able to enter the market. It hardly matters how few clicks it takes to switch if there aren’t any decent options worth switching to. And in the market for search engines, data is a powerful barrier to entry.

Then there’s the fact that “one click away” is still quite a distance. The US government’s case revolves around Google paying companies like Apple to be the default search engine in browsers and on smartphones, which raises the question of how much defaults matter. Standard economic models assume that a user switches when it’s in their interest to do so, which simply isn’t the case. In their book Nudge, Richard Thaler and Cass Sunstein call this the “yeah, whatever” heuristic: “If, for a given choice, there is a default option…then we can expect a large number of people to end up with that option, whether or not it is good for them,” they write.

The “yeah, whatever” heuristic and other findings from behavioral economics have made waves in social science, but unfortunately they haven’t had as much impact on antitrust. US courts are unlikely to recognize the barrier that “a click away” truly represents. Google gets it, though, which is why it pays billions to be the default. —Walter Frick

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Five things on Quartz we especially liked

Empty businesses like this patio in Atlanta are a major reason why Black employment in the hospitality and service industries is still down six months after initial measures to control Covid-19. The latest data from the US Bureau of Labor Statistics shows the labor force participation rate of Black Americans dipped to 44-year lows, and is in danger of becoming a long-term trend in the fall.
Image copyright: Reuters/Elijah Nouvelage
Shutdowns are pushing Black workers out of the labor force.

Black Americans are struggling to return to the workforce. Ever since the US economy shut down in March, people have wondered: Will the recovery be a V-shaped snapback or take a two-tiered “K” shape? As Karen Ho explains, it’s a bad sign that Black Americans are getting back to work at lower rates, and could indicate more disparities in the future. —Alex Ossola, special projects editor

Bringing it all back home. In 2019, migrant workers sent $554 billion in remittances to their home countries. Many economists feared that Covid-19 would restrict the flow of money, but the opposite happened. Contributors Laura Caron and Erwin Tiongson review possible reasons for the resiliency of remittances, explaining that migrants often work in essential industries and will send more money home if they sense their families are suffering. —Dan Kopf, data editor

Out with “to-dos,” in with “ta-dahs.” Seven months into the pandemic, it can be discouraging to work from home surrounded by an endless list of tasks. We need time to just be. Sarah Todd proposes a solution: Instead of stressing over items you have to do, make a list of the things you have already done. Over time you should see that you really are making progress, and there are small victories worth celebrating. —Katherine Ellen Foley, health reporter.

Some ballot systems are truly wild. Take for instance the requirement that Americans abroad must construct their own mail-in envelopes. Anne Quito’s illuminating article helped me understand how state laws, not to mention the sheer size of the country, have led to today’s design predicament—and how ballots may yet be changed for the better. —Sarah Todd, senior reporter

The face of American hunting is changing. Hunting bastions in the rural US are losing population while neophyte sportsmen like Quartz’s own Oliver Staley step in from the cities. The demographic shift is altering a key voting bloc that holds sway over environmental preservation and gun control. Oliver took to the woods with Steven Rinella, the host of Netflix reality series MeatEater, to talk through the implications in hushed tones from a deer blind. —Nicolás Rivero, tech reporter


Markets haiku: Very exciting

An animated gif from an episode of the TV show Saved by the Bell in which Zack tries to console Jessie, with a caption that reads, I'm so excited!
Image copyright: Giphy

“Super excited”
Is Q3’s equivalent
Of “great quarter, guys!”

An uncontained pandemic. A shrinking economy. What could corporate executives possibly be excited about? A lot, it turns out. Executives said “super excited” more than ever in the third quarter, according to a Quartz analysis of transcripts from earnings calls, conferences, and analyst and shareholder meetings. John Detrixhe digs into the latest batch of earnings calls to find out who is most enthusiastic, and why.

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One membership thing that made us think

A woman sits alone on a bench while using her mobile phone as the sun sets at a beach.
Image copyright: Reuters/Dinuka Liyanawatte
Disability advocates are fighting to make podcasts more accessible to the hard of hearing.

A failure to listen. Over 100 million Americans listened to podcasts last year. Despite this success, the industry has failed to include non-English speakers and those with hearing disabilities. At least 37 million Americans have trouble hearing and they deserve more from companies like Gimlet Media. Patrick deHahn carefully explains how a lack of regulations and mounting transcription costs exacerbate the situation, and how AI technology can help bridge the gap. —Karen K. Ho, global finance and economics reporter


Two fun facts

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🚦 Traffic lights: The red-yellow-green color scheme is thanks in large part to railroad signaling systems, which used the colors for signaling across long distances. The colors’ global adoption weren’t without resistance, however. During China’s Cultural Revolution in the 1960s, chairman Mao Zedong’s Red Guard tried to reverse the red and green signals, so red, the color of the revolution, would signify going forward. Their campaign never came to fruition. Don’t stop—read the rest.

🗳 Post-election chaos: The madness of a controversial election comes down to confusing and dismaying the public’s political power. The first thing to do is let your voice be heard, and vote. The second thing to do is remember we’ve been here before. When democracy stops being polite and starts getting real, it’s not the end of the world—remember why the power is with the people in the first place. Nothing this year is going to be clear-cut, but we’ll get through it together.

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Getting luxury, closer to home

Western Europe has long been one of the world’s top spots for luxury shopping, and not just for Europeans. Tourists from the US and around Asia—once mostly from Japan, but more recently predominately from China—were responsible for a large share of the region’s sales, in part because prices for French and Italian luxury brands were much better in Europe.

Thea pandemic has prompted more shoppers to do their luxury buying closer to home. The industry calls it “repatriation.”

  • Kering says that wealthy American tourists buying at home are behind Gucci’s 44% and Saint Laurent’s 32% North-American third-quarter sales jump.
  • Kering’s sales in Asia, got back to growth with the help of Chinese shoppers buying more goods in China.
  • Hermés saw global sales growth, driven by more Chinese shoppers making domestic purchases.
  • At LVMH—the owner of brands such as Louis Vuitton and Dior—overall sales fell as duty-free retail struggled, but it fashion segment grew 12%.


Five things from elsewhere that made us smarter

U.S. President Donald Trump takes part in a groundbreaking with Wisconsin Governor Scott Walker (L) and Foxconn Chairman Terry Gou (R) during a visit to Foxconn's new site in Mount Pleasant, Wisconsin, U.S., June 28, 2018.
Image copyright: Reuters/Kevin Lamarque
How it started…

Foxconned. In 2018, US president Donald Trump and executives from Taiwan’s Foxconn broke ground on a massive LCD screen factory in Wisconsin that was expected to create 13,000 jobs. Millions in taxpayer subsidies aided the project, but the jobs never arrived. A Verge investigation now reveals that this was the plan all along. Left behind: an industrial park of empty buildings and embittered locals who hoped for high-paying, high-tech jobs. —Tim Fernholz, senior reporter 

Germany’s role in China’s grand plans. Beijing has ambitions to leapfrog the world’s major economies and establish dominance across strategic and geographic sectors—and whether it succeeds hinges on Germany. That’s the thesis of a fascinating report by Emily de La Bruyère and Nathan Picarsic, published by the Foundation for the Defense of Democracies, in which the researchers argue that Beijing intends to use Germany as a tool, partner, and competitor to shape the rules and technology that will govern the 21st century global economy. —Mary Hui, reporter 

With friends like these… A scathing account of Donald Trump’s four-year record of cozying up to the worst people on the planet would not be unexpected in Mother Jones, say, or The Nation. That it appeared in conservative stalwart the National Review is more surprising. Senior editor Jay Nordlinger pulls no punches, and reminds his readers that a magazine that spent decades making the case for more freedom has a duty to criticize a president who sides with leaders who trample it.  —Oliver Staley, culture and lifestyle editor

Have you heard of the 4% rule? That’s the amount of money you’re supposed to be able to withdraw from your savings each year in retirement and not run out. It’s been controversial! Now the rule’s creator tells MarketWatch that that was a worst-case scenario. Instead, you can probably safely withdraw… about 5% of your savings each year. Yay? —John Detrixhe, senior reporter

Chronicles of custard. Many Indians, like me, grew up eating a yellow, gelatinous pudding—served warm when they were ill, and cold as a “fancy” dessert. This warm-and-gooey piece by Sharanya Deepak for Fifty Two traces the humble custard’s cultural history, and how a woman’s allergy to eggs led her British husband to develop a quick packaged product in the 19th century. —Manavi Kapur, Quartz India reporter


Have we whetted your appetite for something else sweet? Check out the Quartz Weekly Obsessions on Jell-O, chocolate chip cookies, and macarons.

An animated gif of a cube of red jell-o bouncing up and down.
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