Federal judge rules that Google runs a monopoly with its search and search advertising businesses
After overseeing a 10-week trial in DC District Court last fall and two days of closing arguments in May, Judge Amit Mehta ruled today that Google violated U.S. antitrust laws by running a monopoly with its search and text advertising businesses. Judge Mehta found that Google had made it difficult for competitors to compete in the search market violating section 2 of the Sherman Act.
During the trial, it was revealed that Apple gets a 36% cut of search ad revenue generated by Safari. Apple Vice President of Services Eddy Cue also said that in 2022, Apple received $20 billion from Google to be the default search engine for Safari. During closing arguments, Judge Mehta mentioned these payments and noted that the size of the checks Google wrote to Apple were large enough to severely limit the number of companies that could compete with Google to be the default search engine for Safari.
Besides Apple, Google has similar deals with other browser developers like Mozilla, known for its Firefox browser, and with phone manufacturers like Samsung. These deals make Google the default search engine on their products as well as Apple's.
"After having carefully considered and weighed the witness testimony and evidence, the court reaches the following conclusion: Google is a monopolist, and it has acted as one to maintain its monopoly. It has violated Section 2 of the Sherman Act."-Judge Amit Mehta
Google defended itself by stating that the reason why Google Search dominated the search market was because it was a superior product favored by consumers. The company also contended that its search business should be compared with bigger companies that feature a search tool even if that tool doesn't search the web. Amazon would be a good example of such a business.
The search business run by Google includes the company's core search engine; the text ads included in the ruling are search text advertisements that are seen alongside search results. The verdict is considered a big triumph for the Department of Justice although it is unknown yet how or even if Google will have to change its business structure.
Today's verdict is the result of separate suits filed against Google by bipartisan attorneys general from 38 states led by Nebraska and Colorado. The suits were combined before pre-trial to limit how many copies of documents and other evidence would have to be produced.
And wait...there's more. The DOJ will see Google in court again starting on September 9th in Virginia. The DOJ claims that Google has monopolized the digital advertising business by boosting its profits while raising costs for advertisers.
During a tough day on Wall Street with the Dow Jones Industrial Average falling by more than 1,000 points, shares of Google parent Alphabet declined $7.76 or 4.61% to $160.64.
FCC OKs Cingular\'s purchase of AT&T Wireless
Things that are NOT allowed: