In 2020, the U.S. Government initiated a lawsuit against Google, accusing the tech giant of engaging in anti-competitive practices. This Monday, Google lost the case. Judge Amit Mehta ruled that Google had employed unlawful tactics to boost its prominence and limit competitors like Microsoft’s Bing, DuckDuckGo, and Yahoo. Google’s dominance has been so significant that the term “Google” has become a verb.
“Google is a monopolist, and it has acted as one to maintain its monopoly,” stated Judge Mehta.
Google’s dominance was partly maintained by paying companies like Apple, Android, Samsung, and other companies in the mobile ecosystem to embed its search engine in their products through exclusive contracts. These contracts have bolstered Google’s user base and driven its search advertisement business.
In the search advertisement business, the company has charged high prices, but due to its monopoly and high user numbers, it attracts most advertisers; after all, Google is the biggest, easy go-to search engine.
Potential Effects of the Ruling
The ruling’s biggest beneficiary appears to be Microsoft. Although Microsoft hasn’t invested as heavily in Bing as Google has in its search engine, the penalties imposed on Google could allow Bing to expand its audience. Google might also be required to implement a “choice screen,” offering users the option to select other available search engines.
Conclusion
It is worth noting that Google plans to appeal the decision. The full impact of the ruling remains to be seen as the proceedings to determine the penalties are yet to begin.
This loss comes shortly (barely weeks!) after OpenAI announced its intention to create a Google competitor; Interestingly, while the case was being filed, part of the reason stated was that Google was powerful enough to threaten future innovation or the rise of a successor.
Google is also facing another lawsuit in the U.S., highlighting the recent legal challenges faced by big tech companies. Apple has also been targeted, first by the EU competition authorities and then by the U.S. Justice Department, which has labelled it a monopoly.
On January 24, 2023, the Justice Department, along with Attorneys General from eight other states, filed a civil antitrust suit against Google for monopolizing various digital advertising technology products. The case is scheduled to be heard in September. Stay tuned as we follow this case and any other regulator vs tech titan showdown!
