These senators seemed ignorant about pretty much everything involved. And as for Mr. Schmidt he should have started by saying that Google is free, it's free for users and for those wanting to be indexed by them so they don't owe any self proclaim competitors anything.
They actually just did. They argued that Google is free, and there's nothing to prevent users from using a different search engine. The argument seems to be that a large market share does not constitute monopoly power. In order for monopoly power to exist, there have to be barriers preventing users from switching search providers.
That is incorrect. A "monopoly" is simply having a large enough control over the market that you dictate how others access that market. Monopolies are not illegal. Google does have a monopoly on search, Schmidt admitted that much today by saying they are "in the area" of having one.
Abusing your monopoly power is however illegal, and that's what Google is being investigated for.