The U.S. Department of Justice, along with state attorneys general in 11 states, filed a major antitrust lawsuit Tuesday (Oct. 20) against Google, alleging that the technology giant maintains an illegal monopoly on Internet search and search advertising.
The lawsuit, which was widely expected, is the most significant antitrust case since the U.S. Department of Justice sued Microsoft for monopolizing the software market in 1998. The lawsuit stems from a year-long investigation of Google and three other technology giants – Apple, Amazon, and Facebook.
Federal Attorney General William Barr called the lawsuit “a landmark case for the Department of Justice and for the American people,” saying, “This is a landmark case.
This lawsuit strikes at the heart of Google’s hold on the Internet for the sake of the millions of American consumers, advertisers, small businesses and entrepreneurs who are at the mercy of the illegal monopolist,” Barr said.
Barr said the lawsuit, filed in federal court in Washington, D.C., is unrelated to conservative concerns about content management and censorship of online platforms.
In recent years, President Donald Trump and Republicans have accused Google and other online platforms of silencing conservative voices. In May, Trump signed an executive order taking aim at a law that protects social media companies from liability lawsuits. Last month, the Justice Department introduced a bill to amend that law.
Google’s chief legal officer, Kent Walker, said in a statement that the lawsuit was “seriously flawed.
People use Google because they choose to, not because they are forced to or because they can’t find an alternative,” Walker said in a blog post. This lawsuit will do nothing to help consumers. Instead, it will artificially enable lower-quality alternative search options, raise phone prices, and make it more difficult for people to access the search services they want to use.”
Google’s parent company, Alphabet Inc, is based in California and is worth trillions of dollars, with revenues of $162 billion last year. Google accounts for nearly 90 percent of all search queries in the U.S., making it the top search engine. The rest of the market share is shared by search engines such as Microsoft Bing and DuckDuckGo.
The 64-page lawsuit alleges that over the years, Google “has used anticompetitive tactics to maintain and extend its monopoly in markets such as universal search services, search advertising, and universal search text advertising, which are the cornerstones of its empire.”
The lawsuit specifically alleges that Google pays billions of dollars each year to U.S. wireless carriers such as Apple Inc. and AT&T Inc. to ensure that its search engine has default status on billions of devices and computers around the world. The lawsuit alleges that users rarely change their default settings, effectively blocking rival search engines.
According to the lawsuit, Google uses its search monopoly to sell “search ads” and “universal search text ads. When a user searches for a product or service, a search ad pops up. The text ads appear above or below the search results.
Advertisers pay Google $40 billion a year, and Google then “shares” some of the revenue with distributors and carriers that agree to set Google as the default search engine, the lawsuit says.
The plaintiffs say: “Google excludes any meaningful search competitor from access to critical distribution and scale, eliminating competition for most search queries in the United States.”
U.S. lawmakers and consumer advocates have long accused Google of using its market power to stifle competition, increase profits and harm consumers.
A subcommittee of the House Judiciary Committee recently issued a report after a year-long investigation into market dominance in Silicon Valley and concluded that Google has a monopoly on the search market. The report said that Google had established market dominance by making acquisitions in several markets, buying about 260 companies that other companies had built over a 20-year period.
The state attorneys general who joined the brief represent Arkansas, Florida, Georgia, Indiana, Kentucky, Louisiana, Mississippi, Missouri, Montana, South Carolina, and Texas. All of these state attorneys general are Republicans. Another group of states is expected to file suit against Google later this year.
In recent years, Google has been hit with hefty fines in Europe for its business practices. According to Reuters, in 2019, the European Union fined Google $1.7 billion for stopping websites from using Google’s competitors to find advertisers.In 2017, the European Union fined Google $2.6 billion for favoring its own shopping business in search.In 2018, the European Union fined Google $4.9 billion for blocking Google in its Android wireless operating system.In 2017, the European Union fined Google $2.6 billion for favoring its own shopping business in search. Competitors.
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