It is so associated with web search that it has become a verb.
Now the government is suing Google, accusing it of abusing its power as a monopoly.
The case was opened last week.
The case is complicated. It's about Google's search engine business — which has captured 90 percent of the search engine market in the United States and 91 percent worldwide, according to Similarweb, a data analytics firm. It also includes its advertising activity.
Are also it is not likely to be the most transparent trial. Google claims that much of the testimony contains proprietary information and can therefore only be kept behind closed doors. A tentative 10-week calendar also makes sustained mainstream press coverage unlikely.
However, the case is very important.
It is “the first monopoly test of the modern Internet age.” according to the New York Timesand compares to the 1998 case against Microsoft in which a judge found for the company violated antitrust laws.
“It's a big deal happening now,” he says Elettra Bietti, assistant professor at Northeastern's School of Law and Khoury College of Computer Sciences. Bietti also practiced antitrust law in Brussels and the United Kingdom and practiced patent litigation in the pharmaceutical and technology industries.
Bietti noted that the Federal Trade Commission and state attorneys general first investigated Google Search for search bias about a decade ago, but closed the case. He also noted that this case also includes web search – a service that most consumers understand.
“The lawsuit is certainly an indication that something has changed in the political landscape and that there is a different kind of public appetite for more proactive enforcement against Big Tech,” Bietti continues.
So, what are the key things you need to know as lawyers battle it out in federal court?
Northeastern Global News spoke with antitrust experts John QuocaNeal F. Finnegan Distinguished Professor of Economics, and Bietti to find out.
What to prove: the Department of Justice
Kwoka — who also served as chief economic adviser to FTC Chairwoman Lina Khan last year — says the government needs to prove two things in this case.
First, it must prove that Google has market power or monopoly, or the ability to manipulate the price of an item in the marketplace by manipulating the level of supply, demand, or both.
Second, the government must prove that Google maintained its monopoly by engaging in anticompetitive acts of foreclosure. For example, if they extend their market power to the extent that they use it for leverage in a different business.
“Your idea is all yours, but if you start doing things to defend it that fall outside the normal business practices associated with competitors and try to gain control of another market by leveraging your dominance in something else: it's where Microsoft got into trouble and where all the tech companies are being audited now,” says Kwoka. “The government isn't trying to take down Google, it's trying to prevent Google from killing its competitors.”
Bietti says the second issue presents the most important point of the case, seeing the case as similar to the Microsoft case.
“The main question in that case was whether Microsoft was bundling browser access and Windows and a variety of different services in ways that foreclosed potential competitors,” says Bietti. “We're seeing something very similar argued in the Google case … they're (both) already monopolists, there's not necessarily a question here as to whether that monopoly was legally achieved or not, so the main question at hand is whether Google illegally maintains its monopoly”.
The trial is certainly a sign that something has changed in the political landscape and that there is a different kind of public appetite for more proactive enforcement against Big Tech.
Elettra Bietti, assistant professor at Northeastern's School of Law and Khoury College of Computer Sciences
Case of Google
Google is expected to vigorously challenge both that it has market power or a monopoly and that its dominance is based on illegal practices.
As for whether it has market power, Kwoka says Google will say the mere presence of competitors like DuckDuckGo and Microsoft Bing proves the company doesn't.
Furthermore, Google can argue that consumers drive Google's dominance — not market power.
“The (Google) search engine is good, there's no doubt about that,” says Kwoka. “They can say, 'We're not forcing anyone to use it, they're using it because they want to, it's a good product. If they want Bing or DuckDuckGo, they can download it and click on it.”
The “consumer choice” argument must also be made in defense of Google's practices. Google will argue that its size and scope are demanded by customers who want a “seamless” experience, Kwoka predicts. For example, Google could say that customers want an advertising service that is integrated with Google because Google provides the best search experience.
Google may also claim to be a victim in the case.
“They could argue that by hacking the system, the DOJ is giving an unfair advantage to competitors, and that's against antitrust law: the government shouldn't be playing one competitor off against another,” Kwoka explains.
Arguments for the Department of Justice and the States
Kwoka said the government, as stated in the complaint and filing of the case, intends to argue that Google deals with companies like Apple, Samsung and Mozilla to be the default search engine in their products crossed the line into exclusionary practices aimed at protecting market share.
But where do you draw the line between legitimate business practices and anti-competitive practices?
Kwoka says a key question is whether business practices benefit consumers.
This may be a tough sell for Google.
“There's no way I can make a credible argument that if I have an iPhone or a Mac and only have one search engine, that benefits consumers,” says Kwoka. “It doesn't benefit consumers, it shuts out competitors,” Kwoka said.
He compared a sponsorship deal — say for a beer company to sponsor the Boston Red Sox — to an exclusivity deal. “It's one thing to pay for advertising space and another to pay to keep someone from being an advertiser,” Kwoka continues.
Kwoka said the government also plans to introduce internal Google documents that “come close to saying (Google) is trying to protect its market share.”
“Some of it, I have to say, looks like it might be hard for Google to explain,” Kwoka says. “They make it sound like they think their default presence is incredibly valuable to them and have worked long and hard to maintain exclusivity.”
The government will further argue that foreclosing competitors has stifled innovation.
“The theory is very simple: a monopolist doesn't have the same incentive to innovate,” says Kwoka. “Most disruptive innovations come from outside the larger companies because smaller businesses have more to gain.”
Arguments for Google
That doesn't mean it will necessarily be an easy case for the government to prove.
One challenge for the government is that Google — and possibly the judge — will push its lawyers to describe what the world would be like if Google had competition. It's a hypothetical but important question.
“It's hard to know what the world would look like if there was more competition in search and advertising,” says Kwoka.
Kwoka predicts the government will try to respond by pointing to precedent.
“When AT&T broke up, it led to a huge increase in services,” says Kwoka. “But no one could have predicted what breaking up AT&T would do at the time.”
The government also needs to respond to the argument that Google's services are useful to consumers because they want a seamless experience — a question Kwoka is curious to see asked.
Bietti also notes that the government has the challenge of trying to legally intervene in a famously unregulated market.
“I think it's difficult,” says Bietti. “I think there are a lot of questions about how US law fails to recognize the types of power that Big Tech companies have.”
“Ultimately, when you think about Big Tech markets, they are opaque markets and all the paperwork is in the hands of the tech players,” Bietti continues. “A lot of evidence is not available to the government to prove things.
There is also the vast amount of resources at Google's disposal.
“To me it seems like a very strong case against Google, but the reality is that the FTC and the DOJ are severely understaffed and they don't have the money that Google has,” Bietti says. “There is reason to be skeptical about what will happen.”
What will happen?
Which leads to the ultimate question: What are the possible outcomes of the case? Does Google sell some of its apps? Fines? Limits on Google's behavior?
It's hard to say for sure, but it helps to see the Microsoft case.
In 2000, a judge ordered Microsoft to break up. The company successfully appealedhowever, and after settled with the Department of Justice.
Kwoka says Microsoft's case may not be something the government wants to emulate.
“In the past, the government has too often compromised on trying to change company behavior with so-called behavioral means,” says Kwoka. “They prohibit certain practices or require the company to do certain things, but they almost always fail because companies always have an incentive to work around them and they usually succeed.”
Instead, Kwoka has written about the need to consider breaking up tech companies, for example Google splitting its Android operating system.
“Only then will they have no incentive to work around these rules about their behavior,” says Kwoka. “If they separate, they will behave as independent companies.”
But perhaps even more unknown are the consequences.
Bietti wonders if the case could affect the future of the next frontier in Big Tech — artificial intelligence, which includes the same major companies as the players.
And the case certainly seems to signal further scrutiny of the industry. The FTC sued Amazon on Tuesday.
Cyrus Moulton is a reporter for Northeastern Global News. Email him at c.moulton@northeastern.edu. Follow him on Twitter @MoultonCyrus.
