UPDATED 19:30 EDT / SEPTEMBER 12 2023

NEWS

In antitrust case, Google insists its dominance of internet search is lawful

Google LLC today insisted that it has not broken any laws to maintain its dominance of the internet search industry, saying that its search engine remains the world’s most popular thanks to its quality.

In a summation of its longtime stance, the search giant argued that dissatisfied users have always been able to switch to an alternative platform with a “few easy clicks.”

The U.S. Justice Department has accused the Alphabet Inc.-owned company of paying more than $10 billion in annual fees to ensure that device makers such as Apple Inc., browser makers such as the Mozilla Foundation and wireless operators such as AT&T Inc. select Google Search as their default search engine. This is how Google has been able to maintain a market share of more than 90%, the Justice Department says.

Reuters reported that Kenneth Dintzer, arguing for the Justice Department, said Google began an illegal effort to maintain its monopoly of search back in 2010, and said the ongoing case is “about the future of the internet.”

For Google, search is a key element of a business that rakes in tens of billions of dollars every quarter. It’s Google Search that drives the bulk of its advertising sales, which account for the majority of the company’s profits.

John Schmidtlein, representing Google, said the payments made to those firms are compensation for the work they put in to ensure its software receives timely software updates. “Users today have more search options and more ways to access information online than ever before,” Schmidtlein explained. He added that Google won competitions held by Apple and Mozilla that asked users to choose their favorite search engines.

The lawyer further pointed out that consumers who are unhappy with Google’s search engine can replace the Google app on their devices with an alternative such as Microsoft Corp’s Bing, DuckDuckGo or another platform in just a few clicks.

But Dintzer argued earlier that, in addition to the payments, Google has also manipulated its ad auctions in ways that force advertisers to pay more for their ads. “Defaults are powerful, scale matters and Google illegally maintained a monopoly for more than a decade,” he said. “The consequences are that without serious competition, Google innovated less and paid less attention to other concerns like privacy.”

The Justice Department is being joined in its antitrust lawsuit against Google by multiple state attorneys general, and together they have leveled numerous allegations against the internet giant. They’re challenging Google’s wide-reaching control of the internet. They argue that the payments to device makers harm competition, not only because Google’s search rivals can’t compete, but also because Google contractually obligates device makers to pre-install various other Google apps and services as part of the agreement.

In his opening statement, Dintzer said the Justice Department has also unearthed evidence that Google tried to protect communications about the payments it made to device makers and wireless operators. “They knew these agreements crossed antitrust lines,” he insisted.

Speaking for states led by Colorado, William Cavanaugh turned his attention to allegations that Google refused to give Microsoft access to certain features on its Google Marketing Platform SA360. He said the company did so for financial reasons.

Former Google economist Hal Varian was the first witness called on behalf of the government, and was quizzed about discussions he had with other executives on the importance of Google becoming the default search provider during the mid-2000s. “I think in general having the default is valuable,” he said.

The trial is taking place in a federal court in Washington, D.C., and is expected to last up to 10 weeks. In the first phase, Judge Amit Mehta will decide if Google has broken any antitrust laws over how it manages its search and advertising business. Should he find Google guilty, a second phase will decide how to resolve the issue. He could order Google to cease certain practices he has found to be illegal, or force the company to sell assets.

The case is the first in a series of court challenges targeting Google over its wide-reaching economic power. The outcome of the case could be a bellwether for President Biden’s more assertive antitrust agenda, which has led to other lawsuits and investigations against other technology giants, such as Meta Platforms Inc. and Amazon.com Inc.

Photo: Pixabay

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