U.S. suing Google in biggest antitrust case in decades
Oct 21 2020
The US Justice Department and 11 states filed an anti-trust lawsuit against Alphabet Inc's Google on Tuesday for allegedly breaking the law in using its market power to fend off rivals. Eleven states, all with Republican Party attorneys general, joined the federal government in the case. Google pays Applebillions of dollars a year to have its search engine set as the default option on iPhones and other devices.
The suit will specifically target the company's business dealings with device manufacturers who use the Android operating system, onto which Google's search engine comes pre-loaded. By systematically reducing the quality of its search results in order to entrench and extend its search and search advertising monopolies, Google is directly harming consumers.
Naturally, Googlehas fired back, calling the action "deeply flawed". Google insists that it holds no special power to force people to use its free services or prevent them from going elsewhere. That's because almost half of Google search traffic in 2019 came from Apple products, according to the lawsuit.
Google Search uses a variety of algorithms to surface search results it thinks are best for you, and when you factor those algorithms together with the sheer popularity of Search, a lot of people argue that Google is only letting people see what Google wants them to see. The latest data cited by the government says that over the last few years, Google accounted for over 90% of all general search queries in the USA and 95% on mobile devices.
The move comes after months of investigations by U.S. federal and state antitrust enforcers seeking to check the company's power and parallel probes into other titans such as Amazon, Facebook and Apple.
Search also drives Google's position as the leader of the digital triopoly.
Last September, James announced that she and a bipartisan coalition, which included nearly every attorney general in the nation, initiated a bipartisan investigation into Google for potentially anticompetitive conduct.
The lawsuit marks the government's most significant attempt to protect competition since its groundbreaking case against Microsoft more than 20 years ago.
Google accounts for about 90% of global web searches.
The company has long maintained that although its businesses are large, they are useful and beneficial to consumers.
The Justice Department is expected to file a lawsuit Tuesday alleging that Google has been abusing its dominance in online search to stifle competition and harm consumers, a person familiar with the matter told the Associated Press. The biggest of these is an agreement that makes Google search the default on iPhones and other Apple devices. Amazon installed its own apps and app store instead of the usual Google offerings, and went with Microsoft's search engine. "For the sake of American consumers, advertisers, and all companies now reliant on the internet economy, the time has come to stop Google's anticompetitive conduct and restore competition", it says.
As predicted, Google dismisses the complaint by referencing that it's business as usual for not only itself but every other business in the industry. Apple's income from the search deal is believed to be part of the company's growing Services segment, a key metric Apple has highlighted to investors and analysts in recent years.
Other observers remain skeptical the Justice Department's case is really about reining in Google.