A closer look at the decision: Google abused its monopoly power

A closer look at the decision: Google abused its monopoly power

On August 5, 2024, the U.S. Department of Justice, Antitrust Division (DOJ), released a statement about the case against Google: it viewed its victory as “an historic win for the American people.” This is regarding the case in which Google was found to be a monopolist and one that abused its monopoly power with respect to Google Search.

The decision of the United States District Court for the District of Columbia (all 286 pages) was filed on August 5, 2024. The court carefully reviewed the relevant contracts. First, there were the browser Agreements between Google and Apple, Google and Mozilla, and Google and other platforms. Second, there were the Android Agreements as well.

The court concluded the following:

  • The DOJ could show that Google had monopoly power in the general search services and general search text advertising.
  • The DOJ could show that Google engaged in exclusionary conduct regarding general search services and general search text advertising—they blocked their rivals from the most effective channels of search distribution, namely out-of-the-box default search settings.
  • The court questioned whether the exclusive distribution contracts appeared to significantly contribute to maintaining a Google monopoly. The court responded, “The answer is ‘yes.’”
  • The court declined to impose sanctions on Google for its failure to preserve its employees’ chat messages, but it made a point of saying that it was not condoning Google’s failure to preserve chat evidence.

As a result of the findings, the court concluded that Google violated section 2 of the Sherman Act, 15 US Code § 2. Section 2 states that:

“Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine not exceeding $100,000,000 if a corporation, or, if any other person, $1,000,000, or by imprisonment not exceeding 10 years, or by both said punishments, in the discretion of the court”

The court held that Google violated this provision by maintaining a monopoly in two product markets in the United States:

  1. General search services
  2. General text advertising

Google accomplished this through its exclusive distribution Agreements. Consequently, Amit P. Mehta for the court stated that Google was liable. Google plans on appealing the decision.

What was the penalty? Nothing yet—we will have to wait and see what transpires in a future proceeding. Considering that Google has spent billions of dollars on its exclusive contracts to ensure that it would become (and remain) the world’s default search provider, the effect could be significant. It is worth wondering what might happen—perhaps Google will have to pay hefty fines, implement a “choice screen” to let users know about other options in search, or maybe it will have to be broken up into smaller companies.

What can be said for sure is that this case has been described as the biggest tech antitrust case since the US government’s antitrust case against Microsoft. The decision may change the way we all use search in the future. It might even influence what courts conclude in upcoming antitrust cases against Apple and Amazon.

One might ask whether this case was really a win for the American people or a win for Microsoft and others like DuckDuckGo. One result of this decision could be that some companies will begin to have room to invest, grow, and innovate in search services again, which could result in more opportunities for users.

Antitrust
competition
DOJ
Google
Monopoly
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