Google has engaged in illegal activity by using its search-engine dominance to thwart competition, a federal judge ruled on Monday in a landmark decision that could have major implications for the way Americans consume information.
The U.S. District Court for the District of Columbia ruled against Google this week, after the Department of Justice and a coalition of state attorneys general challenged the tech company’s market dominance in 2020. U.S. District Judge Amit Mehta said in the decision that Google is a “monopolist” that has “acted as one to maintain its monopoly.” Google paid $26.3 billion in 2021, for example, to promote its search engine as the default option on smartphones and browsers.
“The default is extremely valuable real estate,” Mehta wrote. “Even if a new entrant were positioned from a quality standpoint to bid for the default when an agreement expires, such a firm could compete only if it were prepared to pay partners upwards of billions of dollars in revenue share and make them whole for any revenue shortfalls resulting from the change.”
“Google, of course, recognizes that losing defaults would dramatically impact its bottom line. For instance, Google has projected that losing the Safari default would result in a significant drop in queries and billions of dollars in lost revenues,” he added.
Google will likely appeal the ruling to the U.S. District Court of Appeal for the D.C. Circuit. The last time U.S. government officials sued a corporation over monopolistic practices was in the early 2000s, when the DOJ accused Microsoft of exploiting the web browser market with Internet Explorer.
Trade association NetChoice said in a statement that the ruling hurts American consumers, who “use and appreciate Google’s services for their needs,” Carl Szabo, the Vice President and General Counsel of NetChoice, said.
“Today’s ruling against Google will do nothing to help American consumers, and they are the real losers of this decision. By targeting and punishing standard business arrangements, the ruling stifles innovation and hinders the ability of American companies to compete globally. It sends a message to the world that the United States is willing to punish success and could discourage other companies from investing in similar technological advancements that drive our economy forward,” Szabo said. “Americans benefit from the unparalleled convenience, speed and accuracy of Google’s search engine, and that success has inspired fierce competition in the online search market.”
Republicans have leveled complaints against Google in recent months, saying that the company’s search engine deliberately omit from its results center-right views. For example, Google admitted to Congress that “predictions for queries about the assassination attempt against former President [Donald] Trump” “should have appeared but didn’t.” The search engine “failed to provide relevant results about the attempt on President Trump’s life,” Republican lawmakers said on Monday.
“Google employees have previously raised concerns that the internal unspoken company standard is to play ‘whatever political side of the fence’ that the country is on,” Senator Roger Marshall (R., Kan.) said last week. “Furthermore, some of my Republican colleagues have raised concerns regarding recommendation system algorithms under the umbrella of Alphabet and the bias of content they provide to operators seeking information.”