On Monday (August 5th), a federal judge in the United States ruled that Google engaged in illegal monopolistic behavior in order to maintain its dominant position in search engines. This ruling has undoubtedly hit the position of this Internet technology giant and may fundamentally change their business model.
Judge Amit P. Mehta of the United States District Court for the District of Columbia stated in a 277 page ruling that Google, a subsidiary of Alphabet, abused its dominant position in the search business by paying $26 billion to make its search engine the default search engine for smartphone web browsers, effectively preventing any other competitors from succeeding in the market.
In 2020, the US Department of Justice and states sued Google, accusing the company of illegally consolidating its dominant position. Its measures included paying billions of dollars annually to companies such as Apple and Samsung, with the aim of making Google Chrome the default option on their smartphone web browsers and automatically processing search queries.
This initiative has helped Google Chrome become the world's most commonly used search engine and generate over $300 billion in annual revenue, with the majority coming from search advertising.
Judge Mehta pointed out in his ruling that "Google is a monopolist and its actions are aimed at maintaining its monopoly position
This is a beginning
Google is a technology giant built on search engines, and its connection with online search is so close that its name has become a verb ("Google once").
At present, the company is investing heavily in the competition of artificial intelligence, and this ruling will be a major "headwind" for Google. In addition, Google is also facing another federal antitrust case regarding advertising technology, which is scheduled to be heard in court next month.
The latest ruling not only targets Google, but also indicates that the power of tech giants may be limited.
Over the years, large technology companies have used their Internet roots to influence the way people shop, consume information and search online. The federal court's ruling on the Google case may have set the stage, meaning that other antitrust lawsuits filed by government authorities against Google, Apple, Amazon, and Meta will soon be put on the agenda.
It is reported that the last major antitrust ruling against technology companies was over 20 years ago against Microsoft. From the time interval alone, it can be seen that this victory is of great significance to the US Department of Justice.
Rebecca Haw Allensworth, a professor of antitrust at Vanderbilt University Law School in the United States, pointed out that "this ruling is the most important antitrust case of this century and the first of a large number of cases against large technology companies. This is a huge turning point
Google will file an appeal
Judge Mehta's statement ended a case that had been ongoing for several years, which began in 2020 and lasted for 10 weeks in last year's trial. And Judge Mehta's upcoming decision may also force Google to change its operating methods or sell some of its businesses.
Jonathan Kanter, a senior antitrust official of the US Department of Justice, pointed out in a statement that "this landmark decision requires Google to take responsibility. This paves the way for innovation in future generations and protects the access of all Americans to information."
However, Kent Walker, President of Global Affairs at Google, stated that the company will appeal this ruling. Walker pointed out, "This decision acknowledges that Google provides the best search engine, but the conclusion drawn is that we should not be allowed to easily obtain it. As this process continues, we will continue to focus on creating products that people find useful and easy to use
During the trial, Microsoft CEO Satya Nadella testified that he was concerned that this dominant position would create a "Google network," and that Google's relationship with Apple would be an "oligopoly. He said that if Google's momentum is not suppressed, it is likely to dominate the race to develop artificial intelligence as well.
Google CEO Sundar Pichai countered in his testimony that Google has created better services for consumers.
Google's lawyer stated that users choose to search on Google because they find it useful and the company has been investing to make it better.
The government argues that Google, by paying billions of dollars to become an automated search engine on consumer devices, has deprived its competitors of the opportunity to establish the scale necessary to compete with their search engines. Instead, Google has collected more data about consumers, which is used to make its search engine better and more dominant.