How Google’s massive antitrust loss might transform internet search

Nandini Roy Choudhury, writer

Brief news

• A federal judge has ruled that Google illegally monopolized online search and advertising by paying companies like Apple and Samsung to install Google as the default search engine on smartphones and web browsers.
• The Department of Justice’s victory in this case could significantly impact Google’s business operations and potentially change how we access the internet and conduct searches.
• Google plans to appeal the ruling, and if upheld, it could have implications for other antitrust cases against major tech companies like Apple, Meta, and Amazon.

Detailed news

A federal judge has made the most significant legal ruling against a major technology giant in over two decades, asserting that Google illegally monopolized online search and advertising by paying companies such as Apple and Samsung billions of dollars annually to install Google as the default search engine on smartphones and web browsers.

U.S. District Judge Amit P. Mehta stated in his 286-page decision that Google abused its dominance in the search market by monopolizing search queries on smartphones and browsers, thereby throttling competition and injuring consumers. Search ads are responsible for a significant portion of Google’s annual revenue, which exceeds $300 billion.

“Google has maintained its monopoly by acting as a monopolist,” Mehta wrote.

The Department of Justice’s substantial victory could significantly alter Google’s business operations. Additionally, it has the potential to alter the manner in which we access the internet and conduct information searches.

During the final weeks of the Trump administration, the Department of Justice (DOJ) filed antitrust charges, fulfilling Donald Trump’s commitment to confront the escalating influence of Big Tech. During the Biden administration, which has been particularly aggressive in its pursuit of antitrust cases, that mission has persisted.

In a statement, Attorney General Merrick Garland declared, “This victory against Google is a historic victory for the American people.” “The law applies to all companies, regardless of their size or influence.”
Roger Alford, a professor at Notre Dame Law School who previously served in the Department of Justice’s antitrust division, stated that the case represents the Department of Justice’s most significant victory in a monopoly case in decades. “We have not witnessed a case of this magnitude since Microsoft’s defeat in the 1990s.”

Google declared its intention to file an appeal against the ruling. Kent Walker, the president of global affairs, stated in a statement that the decision acknowledges that Google provides the most effective search engine, but it also concludes that it should not be made readily available.

After the judge’s judgment, Alphabet, the parent company of Google, experienced a decline in its stock price. They experienced a nearly 5% decline on Monday, which was a component of a more extensive decline in technology stocks.
Spencer Weber Waller, a professor at Loyola University Chicago School of Law, stated that the decision would provide a “significant boost” to other antitrust cases that are currently pending against Google, as well as other major tech actors such as Apple, Meta, and Amazon, if it is upheld.

Remedies were not included in the ruling issued on Monday. The remedies will be determined separately, most likely following an appeal. One potential solution would involve Google relinquishing its capacity to negotiate device agreements that have contributed to its search engine’s widespread popularity.

Waller emphasized the importance of establishing the appropriate remedy in order to reestablish competition in the marketplace.

In these types of cases, there are no fines or monetary penalties; however, the court will be required to determine whether Google should be dissolved in some capacity. He stated that it is more probable that the court will require Google to eliminate the exclusive contracts and licensing restrictions that have bolstered its monopoly for years.

Google has contended that its distribution agreements are prevalent in the business sector. It invests in the visibility of its search engine on mobile devices in the same manner as a food manufacturer invests in the promotion of its products at eye level in a grocery store aisle.

In Google’s opinion, switching the default search engine on your device is an option if you are dissatisfied with the company. However, Google asserts that individuals do not transfer because they prefer Google.

Would consumers continue to utilize Google for 90% of their web queries if it were not the primary search engine on a significant number of devices?

Microsoft CEO Satya Nadella testified during the 10-week trial that Google’s unchallenged dominance had established a “Google web.”

Nadella stated during his testimony, “You arise in the morning, brush your teeth, and conduct a Google search.” “While the open web is frequently discussed, the Google web is the true reality.”

Nadella has expressed apprehension that Microsoft’s disadvantage would worsen as artificial intelligence becomes a significant component of search.

In a research note published on Monday, senior analyst Colin Sebastian of Baird Equity Research identified a variety of strategies that Microsoft, Google’s arch-rival, has employed to increase the market share of its Bing search engine over the years. These strategies include paying users to use the search engine and embedding it in Office.

Sebastian stated, “It is evident that individuals favor Google over Bing.”

Adam Kovacevich, CEO of the Chamber of Progress, stated that Microsoft received an undeserved advantage as a result of Monday’s ruling.

Kovacevich stated in a statement that Microsoft is the primary beneficiary of today’s ruling, rather than consumers or small technology companies. “Microsoft has been neglecting search for decades; however, today’s decision presents an opportunity for a court to mandate default deals for Bing.” That is an insult to the consumers who choose Google because they believe it is the finest.

Source : usatoday.com