Google Battles US Justice Department Over Dominance in Online Search
September 12, 2023
Google vs. US Justice Dept.: The Fight Over Online Search Power
The antitrust trial against Google (GOOG, GOOGL), the most substantial of the contemporary digital era, commences today in court. This lawsuit emanates from the Trump administration’s rigorous regulatory stance against Big Tech, a policy that has remained in place under President Biden. Expected to extend over two months (prior to any appeals), Alphabet, Google’s parent company, confronts additional litigation concerning competitive practices in Europe. Moreover, it faces a separate challenge in the U.S. concerning its advertising technology operations.
The Plaintiff: The Department of Justice
The U.S. Department of Justice (DOJ), as the plaintiff, will contend that Google’s monopoly was not established through innovation. Instead, it was a product of exclusive contracts and arrangements that established it as the default search engine on mobile devices and internet browsers. The DOJ asserts that these “bad acts” and “illegal means” drastically inhibited or eliminated opportunities for competitors to thrive. The strategy obstructed potential paths competitors could have utilized to engage consumers. These exclusionary provisions are said to have allowed Google to control 90% of web search traffic, facilitated by its contracts to attain that commanding position.
The Defendant: Google
Defending itself, Google’s legal team will argue that contracts forged with entities like Apple (NASDAQ:AAPL), Samsung (OTCPK:SSNLF), Firefox, and Verizon (NYSE:VZ) were non-exclusive. These agreements didn’t restrict people from seeking out other search engines. Google’s defense will also claim that their product offers a superior user experience, focusing on specific definitions and a wider perspective on web traffic. They point out that numerous platforms, such as Amazon (AMZN) and Meta (META), also host search functions, and those companies are closely monitoring the courtroom proceedings.
Implications of the Trial
The unfolding trial will ascertain whether the U.S. government can successfully launch a monopoly case against Big Tech, following previous unsuccessful attempts against IBM (IBM) (dismissed in 1982) and Microsoft (MSFT) (settled in 2002). However, even if the government claims victory this time, it is not expected to result in a breakup or divestitures of Google. Instead, remedies might include the dissolution of Google’s exclusive search deals. The trial’s outcome will also have significant implications for the future of innovation, encompassing the extent of permissible data collection in the impending age of artificial intelligence and other emerging technologies.