WASHINGTON — The U.S. Google has used its dominance in the internet search industry to keep competitors out and stifle innovation, the Department of Justice alleged Tuesday at the start of the largest antitrust trial in the United States in a quarter-century.
“This is a case about the future of the internet and whether Google’s search engine will ever face meaningful competition,” said Kenneth Dintzer, the main counsel for the Justice Department.
Over the next ten weeks, federal and state attorneys general will aim to show that Google rigged the market in its favor by making its search engine the default choice in various places and devices. A verdict from U.S. District Judge Amit Mehta is likely early next year. If he finds that theyviolated the law, a new trial will be held to determine what steps should be taken to rein in the Mountain View, California-based business.
Top officials from Google, Alphabet Inc. and other strong technology companies are slated to testify. Alphabet CEO Sundar Pichai, who succeeded co-founder Larry Page four years ago, is likely to be among them. Court filings also indicate that Eddy Cue, a senior Apple official, may be summoned to testify.
During the Trump administration, the Justice Department launched an antitrust action against Google, alleging that the firm leveraged its dominance in internet search to acquire an unfair advantage over competitors. Government lawyers claim that Google protects its brand through payola, paying billions of dollars per year to be the default search engine on the iPhone and web browsers such as Apple’s Safari and Mozilla’s Firefox.
“Google pays more than $10 billion per year for these privileged positions,” claimed Dintzer.
“Google’s contracts ensure that rivals cannot match the search quality ad monetization, especially on phones,” Dintzer explained. “This wheel has been turning for more than 12 years thanks to this feedback loop.” It always works in Google’s favor.”
According to Dintzer, the more queries Google performs, the more data it accumulates – data that can be used to optimize future searches and give them an even stronger advantage over its competitors. “User data is the oxygen for a search engine,” he explained. As a result of its market domination, “Google search and ad products are better than its rivals can hope to be.” That is why, he claims, the company spends so much for its search engine to be the default option on Apple and other companies’ products.
Dintzer said that Google “began weaponizing defaults” more than 15 years ago, citing an internal Google paper that referred to their settings as an “Achilles Heel” for competing search engines such as Yahoo and MSN.
He also claimed that Google coerced Apple into making its search engine the default on their iPhones in exchange for revenue-sharing payments. “This is not a negotiation,” Dintzer declared. “This is what Google is saying: Take it or leave it.” According to the lawsuit, Apple’s anticompetitive activities stopped it from establishing its search engine.
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The U.S. Google has used its dominance in the internet search industry to keep competitors out and stifle innovation.
Dintzer claimed that they erased documents to keep them out of court proceedings and attempted to conceal others under attorney-client privilege. Dintzer stated, “They destroyed documents for years.” “They turned off history, your honor, so they could rewrite it here.”
Google replies that, although controlling over 90% of the internet search market, it confronts a wide range of competition. Google claims its competitors span from search engines like Microsoft’s Bing to websites like Amazon and Yelp, where customers may post inquiries about what to buy or where to go. “There are lots of ways users access the web other than default search engines, and people use them all the time,” said attorney John Schmidtlein, a partner at Williams & Connolly who represents the company.
According to Google, continuous improvements to its search engine explain why people almost reflexively return to it, a habit that has long rendered “Googling” synonymous with searching things on the internet. Schmidtlein, for example, stated that the changes made their search superior to main rival Bing. “At every critical juncture,” he explained, “they were beaten in the market.”
The trial starts just a few weeks after the 25th anniversary of the company’s first investment — a $100,000 cheque issued by Sun Microsystems co-founder Andy Bechtolsheim that allowed Page and Sergey Brin to set up shop in a Silicon Valley garage.
Today, Alphabet, their corporate parent, is worth $1.7 trillion and employs 182,000 people. Most of its revenue comes from $224 billion in annual ad revenues flowing through a digital services network centered on a search engine that processes billions of daily requests.
The U.S. Google has used its dominance in the internet search industry to keep competitors out and stifle innovation.
The Justice Department’s antitrust complaint is similar to the one it brought against Microsoft in 1998. Regulators then accused Microsoft of compelling computer manufacturers who used its dominant Windows operating system to include Microsoft’s Internet Explorer — just as the internet became more popular. That bundling practice killed Netscape, the once-popular browser.
Several members of the Justice Department’s Google case team, including Dintzer, worked on the Microsoft probe as well.
Google could be hampered if the trial results in concessions that limit its influence. One possibility is that they will be obliged to stop paying Apple and other companies to be the default search engine on smartphones and desktops.
Alternatively, the legal struggle may cause the company to lose focus. That’s what happened after Microsoft’s antitrust battle with the Justice Department. Distracted by its distractions, the software behemoth struggled to adjust to the impact of internet searches and cell phones. Google used that diversion to propel itself from a startup to a formidable superpower.
SOURCE – (AP)
