BusinessSep 12, 2023
The DOJ vs. Google: The Lawsuit that Could Decide the “Future of the Internet”
Market Dominance
Victor Lei
Discover
In celebration of Google’s 25th (belated) birthday, the US Department of Justice (DOJ) has given the world’s “most investigated company” the gift of the most significant monopoly trial in 25 years (coincidence). This comes after the DOJ emerged victorious 2-0 against AT&T in 1974 and Microsoft in 1998, altering the tech landscape and allowing new players to emerge. The DOJ lawsuit was filed in 2020, and the nearly ten-week-long trial finally kicked off yesterday.
Live long enough to become the villain: Ironically, Microsoft’s loss paved the way for then-startup Google to rise. In the search engine market today, there’s Google (~90% market share), and then there’s everyone else. The DOJ believes Google’s “illegal” deals with Apple, Samsung and others let it maintain its dominance by reducing competition.
And despite the rise of AI chatbots and the supposed death of traditional search engines, Google continues to dominate, while Microsoft’s AI-powered Bing has barely captured market share.
Google’s defense: We’re just really good at what we do. One of Google’s top lawyers, Kent Walker, argued, “People don’t use Google because they have to — they use it because they want to” (NPR). During court yesterday, Google’s lead attorney, John Schmidtlein, said consumers could replace the search engine with “a few easy clicks” — and argued that search should include other tools like TikTok and Amazon.
Verdict uncertain: Per the New Yorker, experts estimate the DOJ has better odds than recent Big Tech cases with likely fines or restrictions, but a Google breakup would be improbable. While others believe the DOJ could ban exclusive agreements with Apple and Samsung (WSJ).
The final decision rests with District Judge Amit Mehta, who could decide whether Google needs to be divided up. The case also has major implications for other tech giants like Apple and Amazon — who are both being investigated for monopolistic practices (BBG). Another story for another day.
