US judge declares Google’s search practices illegal

It is a victorious moment for the US Department of Justice and a stumble for Google. However, it also represents a turning point in the tech industry and sets a precedent for future antitrust cases. As reported by BBC, the case was originally started by the Department of Justice in 2020 and intends to increase competition in the innovative sectors of the US economy.

Judge Amit Mehta’s 277-page opinion stated that Google has been paying billions to ensure its position as the default search engine on smartphones and browsers. “Google is a monopolist, and it has acted as one to maintain its monopoly,” the judge wrote.

At the moment, it is difficult to say what the effect or impact of this ruling will be, but it is possible that it will lead to significant changes for Alphabet, Google’s parent company, considering the fines. Of course, the court will decide on these matters, but the firm could be required to make substantial changes if the penalty turns out to be significant.

For now, the company intends to appeal the decision, claiming that its success is due to providing people with superior search engines. Nevertheless, US Attorney General Garland called the ruling “a historic win for the American people” and noted that no firm should be above the law.

This decision is significant as it concerns the essence of Google’s business, its search engine, and related advertising. Generally, the ruling raises questions about the relationship between market domination and fair competition in a world increasingly influenced by digital technologies. This decision is not an exception in the tech industry. Federal antitrust regulators have filed lawsuits on similar charges against other key players in the market, such as Meta, Amazon, and Apple.

The 10-week trial in Washington, DC, finally revealed Google’s business approach. According to prosecutors, Google spent billions of dollars annually to become the default search engine on various platforms, including deals with Apple, Samsung, and Mozilla.

According to the US Government, Google typically invests over $10 billion per year for this privilege. This strategy not only secures Google’s access to user data but also, as prosecutors argued, makes it challenging for other companies to compete effectively.

Department of Justice attorney Kenneth Dintzer, said: “The best testimony for that, for the importance of defaults, is Google’s checkbook.” Google’s search engine generates most of the company’s income by serving advertisements on its results pages. Google’s attorneys believe that their engine is popular with users due to its quality and constant improvements.

Representing Google’s interests, John Schmidtlein noted that Google “is winning because it’s better.” The competition Google faces is from the popular general search engine, Microsoft’s Bing, as well as from specialised sites and applications for certain types of searches, such as choosing and ordering restaurants or flights.

But in his ruling, Judge Mehta emphasised that the significant advantage is “extremely valuable real estate,” allowing the company to surpass its competitors in quality. The judge said that even if a new search company came up with the same quality of search results, it would not have a chance without billions of dollars to invest in securing default positions.

On that note, Google is confronted with another antitrust case regarding its advertising technology, which is expected to be tried in September. Additionally, in Europe, the company has already faced serious fines in similar monopoly cases. Hence, the decision is pivotal in the ongoing conflict over market power in the digital economy.

Though we do not yet know the details of the penalties or changes that Google will have to undergo, it is evident that the decision might reshape the world of digital advertising and online search for the coming years.