Google has lost a landmark antitrust lawsuit case in the US after it was found that the Big Tech giant was funding deals to consolidate its position as the most dominant web search engine.
US Federal Judge Amit Mehta found Google to have spent billions of dollars on exclusive deals with the likes of Apple to create an illegal monopoly over the search engine market, labelling the company as a “monopolist”.
The week-long trial of the antitrust case against Google concluded yesterday and ended a four-year battle between the US Department of Justice (DOJ) and Alphabet – Google’s parent company. The lawsuit case is being viewed as a major win in the DOJ’s bid to reign in Big Tech’s influence over various markets.
Mehta cited Google’s ‘anti-competitive’ deal it had in place with Apple to make it the default search engine on its list of products. Google payments to Apple totalled $26bn in 2021, and a further $20bn in 2022 according to unsealed court documents. Apple was also not a defendant in the case.
This deal in particular was found to have been in conflict with US antitrust laws as Apple’s influence over the mobile phone market helped enable Google to handle more than 90% of all online searches.
Google had also struck similar deals with various other wireless carriers and device manufacturers, argued the DOJ, which were deemed anti-competitive and only served to enhance the Big Tech firm’s grip on the online search market.
This is in part to Google’s ‘feedback loop’ included in deals secured. It allows the firm to routinely renew exclusive deals, which Mehta described as the “antithesis of a competitive market”.
After finding Google had broken US antitrust laws, US Attorney-General Merrick Garland hailed the verdict as a “historic win for the American people”, stating that “no company, no matter how large or influential, is above the law”.
The second phase of the case will now look to determine what actions should be taken against Google in remedies. Whilst it remains unclear what penalties will be imposed, the DOJ may look to halt any deals similar to the one with Apple.
With penalties and remedies still up in the air, the verdict may hamper Google’s lucrative search-engine advertisement revenue, which totalled out at $175bn last year, more than half of its total revenue which stood at $307bn.
However, Mehta found that Google’s ad business did not hold a monopoly over other search engines which plaintiffs argued it did. The US Judge deemed it not necessary to pursue any guilty verdict in this respect.
The landmark victory is the DOJ’s biggest against a Big Tech company in decades and represents new opportunities for similar search-engine companies in the market.
Google does however intend to appeal against the ruling after stating that it “recognises that Google offers the best search engine, but concludes that we shouldn’t be allowed to make it easily available”.
