Saturday, 28 November 2020

Google’s search monopoly under siege as US DoJ takes giant to court

by Harry Baldock, Total Telecom
Wednesday 21 October 20

The much-awaited anti-trust lawsuit has finally arrived, with accusers claiming that Google’s deals with device makers to make its search engine the default has had a negative effect on competition

On Tuesday, the US Department of Justice, backed by the Attorneys General from 11 states, filed a landmark anti-trust lawsuit against Google. The suit claims that Google has deliberately stifled competition in the search and search advertising markets by making deals with device makers to have their search engine receive preferential treatment, whether by being pre-installed or being the only option available to the consumer…

On Tuesday, the US Department of Justice, backed by the Attorneys General from 11 states, filed a landmark anti-trust lawsuit against Google. The suit claims that Google has deliberately stifled competition in the search and search advertising markets by making deals with device makers to have their search engine receive preferential treatment, whether by being pre-installed or being the only option available to the consumer. 
 
The scale of Google’s search engine domination cannot be understated; according to some figures, the company handles around 91.54% of the world’s search queries, while its nearest competitor, Microsoft’s Bing, holds just 2.44%. Of course, there are many legitimate reasons why Google holds the top spot so firmly, not least the company’s incredible scale. Processing around 3.5 billion searches per day, newcomers to the market struggle to match Google for operational power and this is not to take into account Google’s reach as a platform; Google owns a large chunk of the OS market via Android, as well as the world’s dominant video platform, YouTube.
 
Nonetheless, the new government backed lawsuit argues that Google has not entirely been playing fair with regards to its potential competitors. The case suggests that Google has entered into numerous arrangements with device companies for preferential treatment of their search engine, such as a long-term agreement with Apple that Google be the default search engine on their Safari browser. The case also argues that the company uses profits from its monopoly to buy further preferential treatment for its search engine, in what the DoJ calls a “continuous and self-reinforcing cycle of monopolisation”. 
 
The DoJ and the Attorneys General said they would be building on previous antitrust lawsuits – notably against AT&T in 1974 and Microsoft in 1998 –as the basis for this legal case. The latter case in particularly directly stipulated that technology monopolists cannot require preinstalled default status, restrict access to their rivals’ products, or instal undeletable software. At its core, the DoJ will argue that Google’s uncompetitive practices will ultimately hurt customers.
 
Google, naturally, says that it has done nothing wrong and its actions are entirely above board. 
 
“People use Google because they choose to, not because they’re forced to, or because they can’t find alternatives,” said Google’s chief legal officer Kent Walker.
 
It should be remembered that this is not the first time Google has faced accusations related to its market dominance. Most recently, in 2018, the company was fined €4.3 billion by the European Commission for having imposed illegal restrictions on Android device manufacturers and mobile network operators. While Google earned around $137 billion in 2018, hence the seemingly enormous fine practically served as little more than a slap on the wrist, the ruling did force the company to offer Android users a choice of search engines.
 
 
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