A U.S. judge has declared that Google violated antitrust laws by creating and maintaining an illegal monopoly over the search market. This decision, handed down by U.S. District Judge Amit Mehta on Monday, marks a significant victory for federal authorities aiming to curb Big Tech's dominance and could reshape how millions of Americans access information online.
"Google is a monopolist, and it has acted as one to maintain its monopoly," Judge Mehta wrote in his ruling. He emphasized that Google's control over 90% of the online search market and 95% on smartphones is a clear indication of its monopolistic behavior.
The ruling sets the stage for a second trial to determine potential remedies, which could include breaking up Google's parent company, Alphabet Inc. This would be a seismic shift in the online advertising world, where Google has held sway for years. The legal battle is expected to extend into next year or even 2026, with potential appeals to higher courts.
Shares of Alphabet dropped 4.5% on Monday amidst a broader decline in tech stocks, reflecting market jitters about the ruling's implications. Google has announced plans to appeal the decision. "This decision recognizes that Google offers the best search engine, but concludes that we shouldn't be allowed to make it easily available," the company stated.
U.S. Attorney General Merrick Garland hailed the ruling as a historic win for the American people, asserting that "no company - no matter how large or influential - is above the law." White House press secretary Karine Jean-Pierre echoed this sentiment, describing the ruling as a victory for competition and a free, fair, and open internet.
Judge Mehta's decision highlighted Google's extensive spending to secure its position as the default search engine on smartphones and web browsers. In 2021 alone, Google spent $26.3 billion on these exclusive contracts, ensuring that its search engine remained the go-to choice for users. "The default is extremely valuable real estate," Mehta noted, emphasizing that new entrants would struggle to compete without similar financial muscle.
This ruling is the first major decision in a series of cases challenging alleged monopolies in Big Tech. The lawsuit against Google was initially filed by the Trump administration and proceeded to trial last year. The decision comes at a time when federal antitrust regulators have also taken on other tech giants like Meta, Amazon, and Apple, alleging illegal monopolistic practices.
Senator Amy Klobuchar, who chairs the Senate Judiciary Committee's antitrust subcommittee, described the ruling as a significant victory for antitrust enforcement. "Google is a rampant monopolist," she said, underscoring the bipartisan support for such regulatory actions.
The ruling acknowledged the quality of Google's search engine but criticized the company's use of default agreements to stifle competition. Judge Mehta pointed out that other search engines, like Microsoft's Bing, have managed to capture significant market share on platforms where they are the default option, illustrating that competition can thrive under different conditions.
The next phase of the case will focus on determining the appropriate remedies to restore competitive conditions. These could range from imposing fines to more drastic measures like breaking up Alphabet or banning Google from entering into default search agreements. The latter could have far-reaching implications for Apple, which has benefited significantly from its deals with Google.
