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Google’s dominance of internet search faces major challenge in legal showdown with U.S. regulators

Sep 11, 2023, 8:28 AM

The Google sign is shown over an entrance to the company's new building in New York on Wednesday, S...

The Google sign is shown over an entrance to the company's new building in New York on Wednesday, Sept. 6, 2023. The U.S. government is taking aim at what has been an indomitable empire: Google’s ubiquitous search engine and the lucrative digital services hatched by its unwavering status as the internet’s main gateway. (AP Photo/Peter Morgan)
Credit: ASSOCIATED PRESS

(AP Photo/Peter Morgan)

The U.S. government is taking aim at what has been an indomitable empire: Google’s ubiquitous search engine that has become the internet’s main gateway.

The legal attack will swing into full force Tuesday in a Washington D.C. federal courtroom that will serve as the battleground for the biggest U.S. antitrust trial since regulators went after Microsoft and its dominance of personal computer software a quarter century ago.

The 10-week trial before U.S. District Judge Amit Mehta is expected to include potentially revelatory testimony from top executives at Google and its corporate parent Alphabet, as well as other powerful technology companies. Alphabet CEO Sundar Pichai, who succeeded Google co-founder Larry Page in 2019, will be among the most prominent witnesses likely to testify. Court documents also indicate one of Apple’s highest-ranking executives, Eddy Cue, might be called to the stand.

The case against Google mirrors the one brought against Microsoft in many ways, including the existential threat it poses to a renowned tech giant whose products are relied on by billions of people.

The trial is scheduled to continue into late November before its first phase wraps, after which another round of court filings and arguments are expected. Mehta isn’t expected to issue a ruling until early next year. If he decides Google has been breaking the law, it will trigger another trial to determine what measures should be taken to rein in the Mountain View, California, company.

Although Google products such as the Chrome web browser, Gmail, YouTube and online maps all are hugely popular, none have become as indispensable — or as valuable — as the internet search engine invented by Page and a fellow Stanford University graduate student, Sergey Brin, during the late 1990s.

The trial is beginning just a couple weeks after the 25th anniversary of the first investment in the company — a $100,000 check written by Sun Microsystems co-founder Andy Bechtolsheim that enabled Page and Brin to set up shop in a Silicon Valley garage.

Today, Google’s corporate parent, Alphabet Inc., is worth $1.7 trillion and employs 182,000 people, with most of the money coming from $224 billion in annual ad sales flowing through a network of digital services anchored by a search engine that fields billions of queries a day.

Google could be hobbled if the antitrust trial culminates in concessions that undercut its power. One possibility is that the company could be forced to stop paying Apple and other companies to make Google the default search engine on smartphones and computers.

Or the legal battle could cause Google to lose focus. That’s what happened to Microsoft after its antitrust showdown with the Justice Department: Distracted, the software giant struggled to adapt to the impact of internet search and smartphones. Google capitalized on that distraction to leap from its startup roots into an imposing powerhouse.

Nearly three years after filing its antitrust lawsuit during the Trump administration, lawyers from the U.S. Justice Department will try to prove Google has been abusing the power of its search engine to stifle competition in ways that discouraged innovation. Critics say the quality of search results has deteriorated, too, as Google used its engine to sell ads and promote its own products, like Google restaurant reviews instead of those offered by Yelp.

Dozens of state attorneys general, led by Colorado, have waded into the battle and will have a chance to prove Google turned into an illegal monopoly that’s harming consumers.

The crux of the Justice Department’s argument will boil down to its contention that Google’s search engine has become like digital air almost everyone breathes, and that it needs to be cleaned up because the company’s tactics have polluted the atmosphere.

Google’s vast legal team is expected to counter that the company has never stopped improving its search engine, executing its original mission to organize the world’s information and make it universally accessible to anyone with an internet connection. From Google’s perspective, the perpetual improvements explain why most people almost reflexively gravitate to its search engine, a habit that long ago made “Googling” synonymous with looking things up.

Despite commanding about 90% of the internet search market, Google argues it faces a wide range of competition ranging from other search engines such as Microsoft’s Bing and DuckDuckGo to websites such as Amazon and Yelp, where people research questions about what product to buy or where to eat.

The Justice Department contends Google’s claim that it dominates the market by supplying the best search engine is a canard. They allege Google protects its franchise through a form of payola, shelling out billions of dollars annually to be the default search engine on the iPhone and web browser such as Apple’s Safari and Mozilla’s Firefox.

Regulators also allege Google has illegally rigged the market in its favor by requiring its search engine to be bundled with its Android software for smartphones if the device manufacturers want full access to the Android app store.

By locking in Google’s search engine as the default choice in so many places, the Justice Department contends the company has made it more difficult for people to find the best results as quickly as possible.

Regulators allege the company’s deals ensure Google’s automatic access to billions of queries that provide data for its search engine, while boxing out Bing and DuckDuckGo from getting information that could help them improve their results.

The tactics have created a toxic situation allowing Google to cram more ads at the top of its search results, increasing its profits and Alphabet’s stock price, according to the Justice Department. That practice requires consumers to dig ever deeper to answer their questions, something that regulators believe could be avoided if rival services were able to collect as much information as Google does through its lock-in agreements.

Google insists that consumers could easily switch their default settings to another search engine.

The company also argues that it does face competition from evolving technology: Microsoft, for example, is baking artificial intelligence from its business partner Open AI into its Bing search engine. That move in early February prodded Google to start equipping its search engine with AI-fueled results too — a sign that the company says shows competition continues to thrive.

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Google’s dominance of internet search faces major challenge in legal showdown with U.S. regulators