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Monday, July 8, 2024 | Back issues
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Landmark Google antitrust case set to wrap after long break

The trial, which has been on hold since November, centers on whether the tech giant holds a monopoly over internet search, and could result in Google selling off core parts of its business.

WASHINGTON (CN) — After a six-month break, a federal judge will hear closing arguments starting Thursday in a landmark antitrust trial against Google, in which the government argues the tech giant has created a monopoly over internet searches.

Brought by the federal government, 35 states, the District of Columbia, Guam and Puerto Rico, the case centers on the assertion that the $1.7 trillion company established a monopoly with its search engine through lucrative deals to make Google the default search engine on Apple, Android and Mozilla devices. 

Beyond dominating the search market, the states argue that since the company’s founding in 1998, it has monopolized search advertising, forcing marketers to use its products while increasing prices. 

U.S. District Judge Amit Mehta presided over the bench trial, which ran over 40 days, and indicated that if he rules against Google he will hold a second bench trial to determine the appropriate remedy. 

Potential remedies Mehta could enact include enjoining practices deemed anticompetitive, imposing fines or even ordering the company to sell off problematic parts of its business. 

However, Google is sure to appeal any negative result to the D.C. Circuit and potentially the case to the Supreme Court to maintain its position as the so-called “gatekeeper of the internet” that has made the company’s name synonymous with searching. 

Throughout the trial, Justice Department attorneys described Google’s efforts to defend its monopoly, focusing on a “default exclusivity” deal with Apple that made Google the built-in search engine for users on the Safari Internet browser. Users can change that default, but it requires several steps to switch to other engines like Bing or DuckDuckGo. 

Google fought to keep the exact figure paid for the default status a secret in both court documents and witness testimony, but Google’s final witness, Chicago School economist Kevin Murphy, let slip that Google pays Apple 36% of its ad revenue

Specifically, Google paid Apple $26.3 billion in 2021 for exclusive default status. Google’s ad revenue was 81% of its total annual revenue for fiscal year 2021 — approximately $258 billion, according to GlobalData

A wide swath of prominent figures from the tech industry took the stand, including Google CEO Sundar Pichai, Apple senior vice president of services Eddy Cue and Microsoft CEO Satya Nadella. 

In his testimony, Pichai said that Google “fiercely competes” with Apple and other tech companies like Amazon, booking.com and TikTok. Cue said that Apple made the exclusivity deals because Google provides the best product on the market and defended them as mutually beneficial. 

Justice Department attorneys rejected Google and its witnesses' argument that it faces such competition, especially with TikTok. While attorneys acknowledged the popular social media app had cut into Google’s search advertising revenue, it could not be considered a competitor in search, as the app’s search functionality does not even connect to the internet, but rather searches within the app’s content. 

The marathon trial was marred by sealed testimony, redacted documents and closed hearings, much to the ire of the public and the press, creating a so-called “veil of secrecy” over the trial.

Besides Murphy’s slip-up, Google’s lead attorney John Schmidtlein, of the firm Williams & Connolly, made frequent objections during Justice Department questioning to keep supposed trade secrets from public view. 

During the first few weeks of the trial, Mehta had regularly allowed many exhibits to remain redacted, on occasion closing the courtroom rather than presenting them publicly. But as the trial wore on — and a motion was brought by a coalition of media organizations — Mehta began to reject such requests. 

In a clear shift from the trial’s limited access, Thursday and Friday’s proceedings will have a live audio line available for members of the public to call and listen to

Previously, one would have to travel to the E. Barrett Prettyman Courthouse in Washington and line up to be seated in either Mehta’s courtroom or an overflow room where a video stream of the proceedings was played. 

In the intervening months since the trial paused, Google was found to be operating an illegal monopoly via its Google Play App Store and related billing services. 

In December, a federal jury in the Northern District of California found Google had monopoly power in the Android app distribution market and the in-app billing services market following a four-week trial. Epic Games brought the suit in 2020 after the tech giant removed Fortnite from the Google Play Store after Epic hotfixed its hit game to bypass Google’s billing services. 

The jury also found Google guilty of anticompetitive business practices against Epic and that Google had a coercive tie between its app store and billing services, which forced developers to use the tech giant’s billing service to place their apps on Google Play. 

U.S. District Judge James Donato is still weighing potential remedies and possible compensation for Epic. 

Follow @Ryan_Knappy
Categories / Business, Technology, Trials

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