The USA government is considering a move to dismantle Google’s monopoly in the search engine market, potentially leading to the breakup of one of the world’s most influential tech companies.
This proposal was laid out by the Department of Justice (DoJ) following an antitrust ruling in August, where a judge labelled Google as a “monopolist” for violating USA antitrust laws.
Background
As earlier reported by Arbiterz, the USA is filing a lawsuit against Google to permit competition within its Android operating system.
The DoJ’s recent court filings indicate a comprehensive strategy to address the widespread control Google has over online search.
They are looking into both structural and behavioural solutions to stop Google from using its ecosystem—which includes the Android operating system, Play app store, and Chrome browser—to keep its dominance.
These include recommendations that could force Google to limit its use of search results to train generative artificial intelligence (AI) models and force competitors to gain access to user search data.
Disrupting Googles Market Control
Should the breakup proceed, it would reshape the search market, where Google currently processes over 90% of online queries.
The DoJ’s filing emphasizes that Google’s extensive control over distribution channels has stifled competition, stating, “For more than a decade, Google has controlled the most popular distribution channels, leaving rivals with little incentive to compete for users.”
The goal is not only to dismantle Google’s current monopoly but also to prevent future control of distribution networks.
The judge overseeing the case, Amit Mehta, will assess these proposed remedies as the trial advances into its second phase, where final judgments and witness lists are expected to be filed in the coming months.
Google’s Response and Potential Impact
In response to the proposed remedies, Google has described them as “radical and sweeping,” arguing they extend beyond the legal issues at hand and could threaten consumer choice and American competitiveness.
Despite this pushback, Alphabet Inc., Google’s parent company, saw its shares remain stable, maintaining a market valuation of approximately $2 trillion.
Legal Developments Ahead
As the trial progresses, the DoJ is focused on four key areas for potential remedies: search distribution and revenue sharing; generation and display of search results; advertising scale and monetization; and the gathering and use of data.
Proposals include prohibiting exclusive contracts, such as the estimated $20 billion Google pays Apple annually to be the default search engine on Safari.
Additionally, the DoJ aims to enhance competition in the advertising space by possibly requiring Google to license its ad feed independently from search results.
With the rise of AI technologies, the DoJ is also concerned that Google may misuse its monopoly power to further put itself in this new frontier.
What do you need to know?
If successful, the case could be a victory for the DoJ.
It reminds most of the antitrust actions taken against Microsoft in the late 1990s, which ultimately led to a break-up order that was overturned on appeal.
The current Google case provides the DoJ a second opportunity to confront the dominance of a major tech player.
