Judge rules that Google ‘is a monopolist’ in US antitrust case

Washington: A federal judge ruled that Google violated antitrust laws by maintaining a monopoly in the search and advertising markets.

“After carefully considering and weighing the witness testimony and evidence, the court reaches the following conclusion: Google is a monopolist, and it has acted as such to maintain its monopoly,” according to the court’s ruling, which can be read in full at the bottom of this story. “It has violated Section 2 of the Sherman Act.

Judge Amit Mehta’s decision is a significant victory for the Department of Justice, which had accused Google of illegally monopolizing the online search market. Nonetheless, Mehta did not agree with all of the government’s points. For example, he denied that Google possesses monopoly power in a specific segment of the ad market. He agreed with the government, though, that Google has a monopoly on “general search services” and “general search text advertising.”

It is unclear what this ruling will mean for Google’s future business, as the initial finding focuses solely on the company’s liability and not on remedies. Google’s fate will be decided in the next phase of the proceedings, which could range from a mandate to stop certain business practices to the dissolution of Google’s search business.

“This landmark decision holds Google accountable,” DOJ antitrust chief Jonathan Kanter said in a statement. “It paves the way for future generations of innovators while also protecting all Americans’ access to information.” Google did not respond to a request for comment right away.

Mehta rejected Google’s arguments that its contracts with phone and browser makers like Apple were not exclusionary and therefore shouldn’t qualify it for liability under the Sherman Act. “The prospect of losing tens of billions in guaranteed revenue from Google—wwhich presently comes at little to no cost to Apple—ddisincentivizes Apple from launching its own search engine when it otherwise has built the capacity to do so,” he wrote.

He said the framework from the last landmark tech monopoly case, US v. Microsoft, was in fact relevant to the current case against Google. While Google argued that unlike Microsoft, it maintained pretty consistent actions before and after it became dominant in the market, Mehta said that’s irrelevant, since the same conduct can be exclusionary when done by a dominant player, even if it’s not when it’s done by a smaller one.

He described “Google’s monopoly in general search” as “remarkably durable,” writing that it increased from about 80 percent in 2009 to 90 percent by 2020. Bing, by comparison, has less than 6 percent of the of the market,, Mehta added. “If there is genuine competition in the market for general search, it has not manifested in familiar ways, such as fluid market shares, lost business, or new entrants,” he wrote.

“The market reality is that Google is the only real choice as the default GSE,” Mehta wrote, referring to an acronym for general search engine. He cited a quote from Apple SVP Eddy Cue, who said during the trial that there’s “‘no price that Microsoft could ever offer [Apple] to’ preload Bing.”

Mehta underscored the idea that even the largest businesses in the US have no real alternative to Google. “Time and again, Google’s partners have concluded that it is financially infeasible to switch default GSEs or seek greater flexibility in search offerings because it would mean sacrificing the hundreds of millions, if not billions, of dollars that Google pays them as revenue share,” he wrote. “These are Fortune 500 companies, and they have nowhere else to turn other than Google.”

On search text advertising, Mehta wrote that Google’s exclusive agreements enabled it to raise prices on that product “without any meaningful competitive constraint.” While Google argued that the price for its search text ads, when adjusted for quality, has decreased, Mehta wrote that evidence “is weak.” That’s because even Google has recognized how difficult it is to determine “the value of an ad to its buyer,” he wrote. “This evidence does not reflect a principled practice of quality-adjusted pricing, but rather shows Google creating higher-priced auctions with the primary purpose of driving long-term revenues.”

Beyond the monopoly questions, Mehta declined to impose sanctions on Google for failing to preserve chat messages relevant to the case—ssomething the Justice Department characterized as destroying evidence. The requested sanctions “do not move the needle on the court’s assessment of Google’s liability.” But Mehta said the decision “should not be understood as condoning Google’s failure to preserve chat evidence… Google avoided sanctions in this case. It may not be so lucky in the next one.”

The decision is the first in a wave of tech monopoly cases brought by the US government in recent years. While two decades passed between the Department of Justice’s antitrust lawsuit against Microsoft and its next tech anti-monopoly case against Google, filed in 2020, several more such cases quickly followed.

Amazon, Apple, and Meta all now face their own monopolization lawsuits from the US government, and Google will go to trial against the DOJ a second time this fall over a separate challenge to its advertising technology business. That makes Mehta’s decision in this case even more consequential for how other judges may consider how to apply century-old antitrust laws to modern digital markets.