Google is set to appeal on Monday a U.S. District Court ruling that found the company acted illegally to maintain its monopoly on online search.
The ruling by Judge Amit P. Mehta of the U.S. District Court for the District of Columbia is a major defeat for Google and, if upheld, could change the way the company does business and even the structure of the internet as we know it.
Mehta said Google was abusing its monopoly power in the search business by paying companies like Apple to have its search engine appear as the default on devices and web browsers. The Justice Department and states filed an antitrust lawsuit against Google in 2020, with the case set to go before the court in September 2023.
Google pays billions of dollars to companies like Apple, Samsung, and Mozilla for primary visibility on web browsers and smartphones. In 2021 alone, Google spent $26 billion to become the default search engine on the Apple and Android platforms. About $18 billion of that went to Apple, according to The New York Times. Google shares 36% of search advertising revenue from Safari with Apple. The government argues that paying for a dominant position effectively prevented competitors from building their own search engines to the scale that would bring them the data and reach to stay competitive.
“After careful consideration of the witness testimony and evidence, the Court concludes that Google is a monopoly and has acted as a monopoly to maintain its monopoly,” Judge Mehta wrote in an opinion filed Monday. “The Company has violated Section 2 of the Sherman Act.”
Section 2 of the Sherman Act makes it illegal for any person or corporation to monopolize, attempt to monopolize, or conspire to monopolize any part of trade or commerce.
Google's president of global affairs, Kent Walker, told TechCrunch that the company plans to appeal the ruling, reiterating its previous assertions that Google has used its dominant position to create the best and most useful search engine, which benefits both consumers and advertisers.
“This decision acknowledges that Google offers the best search engine, but concludes that it cannot be made easily available,” Walker told TechCrunch. “We appreciate the court's determination that Google is 'the highest quality search engine in the industry, trusted by hundreds of millions of users every day,' 'has long been the top search engine, especially on mobile devices,' 'has continued to innovate in search,' and 'Apple and Mozilla have often evaluated Google's search quality against its competitors and determined that Google is superior.'”
The ruling caps a years-long case, United States et al. v. Google, that became a 10-week trial last year. The Department of Justice and a group of attorneys general from 38 states and territories, led by Colorado and Nebraska, filed a similar but separate antitrust lawsuit against Google in 2020, alleging that the company unfairly excluded search rivals such as Bing and DuckDuckGo. The Department of Justice estimated that Google had a 90% share of the search market, a figure that Google disputes.
The outcome of the case marks a major win for the Justice Department in an election year in which former President Donald Trump is almost certain to take a decidedly more hands-off, deregulatory approach to technology if elected to a second term. President Joe Biden's nominee for chair of the Federal Trade Commission, Lina Khan, has been known to go hard on big tech companies, particularly on antitrust issues, which has not pleased many companies.
The case could set a precedent for many of the other antitrust cases currently before the courts. The Department of Justice has sued Apple for making it difficult for consumers to switch from the iPhone, and the FTC also recently sued Meta for squeezing out early competitors and Amazon for squeezing sellers in its online marketplace.
Mehta's ruling on Monday could also affect the outcome of a second antitrust lawsuit filed by the Justice Department against Google, alleging that the company illegally monopolized the digital advertising market. Arguments in that case are scheduled to begin on September 9.
The judge has yet to decide what remedies there are for Google's actions. He could force the company to change how it runs its search business or order it to sell parts of it. Of course, the decision could be appealed, and the final ruling could vary widely, as happened in Microsoft's famous dot-com-era antitrust case.
In that case, Judge Thomas Penfield Jackson found that Microsoft had violated antitrust laws and ordered the company to be split into two companies. Microsoft appealed the ruling, and the appeals court overturned the split order, but Microsoft had to take certain steps that could affect Mehta's remedial actions against Google, as experts point out today. As part of Microsoft's settlement, the company had to share its APIs with third-party companies and appoint a committee to monitor compliance.
Update: This article was originally published on August 5 at 12:20pm PST. It has been updated with more context and information provided by Google.