Google will battle government claims that it suppressed competition by creating an online monopoly in court today – in what will be one of the biggest antitrust lawsuits of the century.
The proceedings were already underway and started at 9:30 am with opening statements from both sides – with the Ministry of Justice being the other principle.
A veteran DoJ attorney who was part of the legal team on the government’s last major monopoly case began the arguments alleging the company abused its dominance in seeking deals with wireless carriers and smartphone makers.
Lead attorney Kenneth Dintzer claimed the transactions made their engine the first thing users saw when they turned on their phones and browsers. laws that prevent monopolies.
A 30-year veteran of the department, he showed the court a 2007 presentation in which a Google engineer allegedly said that gaining default search rankings on devices from companies like Apple, LG and Samsung could be a “powerful strategic weapon” for the business of the company – and an ‘Achilles heel’ for rivals.
The Justice Department’s case is based on allegations that Google knowingly orchestrated these business transactions with the ultimate goal of manipulating the market and eradicate its competitors.
Google will fight government claims that it has stifled internet competition by creating an online monopoly in court today – in what will be one of the largest antitrust lawsuits in recent history
“Google has illegally maintained a monopoly for more than a decade,” Dintzer alleged Monday, before giving the floor to lawyers representing states and territories that also sued Google in 2020, alleging the company had abused its monopoly position in search .
Their lawsuit, led by Colorado, is being considered along with that of the Justice Department and contains additional allegations against Google.
Their lawsuit alleges that the way Google structures its search results page harms competition by prioritizing the company’s own apps and services over content from third-party sites, as well as other web pages, links and reviews.
The US government adds that Google’s Android operating system in particular has struck anti-competitive deals with device makers because they require smartphone companies to pre-install other Google apps, such as Gmail, Chrome or Maps, without the ability to install them to delete.
Google, meanwhile, counters that these practices fell squarely within the bounds of federal law — specifically the 1890 Sherman Act — and that these practices face a range of competition from sites like Bing, which link to rivals like Amazon and Yelp.
The claims come as the 1.72 trillion still controls about 90 percent of the Internet search market since it was founded by two friends in Silicon Valley in 1998.
A taste of what’s coming in the next ten weeks: It’s the first major government monopoly case in a quarter century, and the first in the age of the modern Internet.
“This lawsuit goes to the heart of Google’s grip on the Internet for millions of American consumers, advertisers, small businesses and entrepreneurs tied to an unlawful monopolist,” former Attorney General William Barr said when the case was first filed in October 2020.
His deputy, Jeffrey A. Rosen, cited previous antitrust cases, such as the 1998 one against Microsoft, that focused on claims that the company illegally grouped its products in a way that suppressed competition and forced people to use them.
He also brought up the Ali-Frazier of the telecom battles of the last century, when the US Department of Justice took on AT&T in 1974 and split the old American Telephone & Telegraph into the new seven regional Bell operating companies (RBOC) – and the much smaller, new AT&T.
“As with its landmark antitrust actions against AT&T in 1974 and Microsoft in 1998, the Department is again enforcing the Sherman Act to restore the role of competition and open the door for the next wave of innovation,” the then-deputy AG said at the time . .
‘This time in vital digital markets.’
Google’s headquarters are pictured in Mountain View, California. The company is facing claims that it is involved in dealings with mobile carriers and phone manufacturers, falsely making its search engine the first thing users see when they turn on their devices or open their web browser.
Google claims it faces a wide range of competition from search engines like Bing, despite having about 90 percent of the Internet search market
Aside from the historical significance of these lawsuits, they provide a somewhat questionable legal precedent for the Silicon Valley search firm.
In the case involving Microsoft – in which officials alleged that the then high-flying company illegally maintained its monopoly on the PC market by removing legal and technical restrictions on manufacturers and users from removing Internet Explorer – the judge ruled in favor of the Ministry of Justice.
In a landmark ruling, Judge Colleen Kollar-Kotelly declared that Microsoft — by not allowing its users to use competing apps like Java or Netscape — violated antitrust laws and had “an oppressive thumb on the scale of competitiveness.”
Now, more than two decades later, the similarities between the case and the new one against Google stand out as strikingly similar — and lawyers retained by the government are seeking a similar outcome.
“That case was about a monopolistic technology platform and the government won,” Professor Rebecca Haw Allensworth of Vanderbilt Law School told NPR on Tuesday morning, a few hours before Judge Amit Mehta brought up Dintzer to give his opening statement.
“And so everyone has seen this as a kind of blueprint for how we can enforce the laws against today’s tech giants,” added the professor, who specializes in antitrust law.
“This is a real test of whether that theory works.”
That said, several members of the Justice Department team on the Google case – including Dintzer – also worked on the Microsoft investigation.
The trial comes just a few weeks after the 25th anniversary of the company’s first investment — a $100,000 check from Andy Bechtolsheim of Sun Microsystems, which allowed financiers Larry Page and Sergey Brin to set up shop in a Silicon Valley garage.
Today, Google’s parent company, Alphabet, is worth $1.7 trillion and employs 182,000 people, with the bulk of it coming from $224 billion in annual ad sales flowing through a network of services anchored by what is by far the most popular search engine in the world.
Google could be hampered if the process ends with concessions that undermine its power. One possibility is that the company could be forced to stop paying Apple and other companies to make Google the default search engine on smartphones and computers.
Or the legal battle could cause Google to lose focus. That’s what happened to Microsoft after the antitrust showdown with the Justice Department.
Distractedly, the software giant struggled to adapt to the impact of web search and smartphones. Google took advantage of that distraction to leap from its startup roots to an imposing powerhouse.