In a historic ruling last Monday, Google was found guilty by a federal US court of maintaining an illegal monopoly over the online search and advertising markets. We analyse the implications of the decision that marks a significant victory for the U.S. Department of Justice (DOJ) and for several state attorneys general.

The lawsuit, initially filed in 2020, accused Google of using its dominant position to stifle competition and maintain its monopoly in the search engine market. The DOJ argued that Google’s practices violate Section 2 of the Sherman Act, which prohibits monopolistic behaviour. The case centered on Google’s exclusive deals with companies such as Apple, Samsung, and Verizon, which ensured that Google remained the default search engine on their devices, thereby excluding competitors.

Judge Amit Mehta’s 277-page ruling was unequivocal in its condemnation of Google’s practices. He stated that Google “is a monopolist, and it has acted as one to maintain its monopoly”. The judge emphasized that Google holds around 90% of the internet search market, with this share increasing to almost 95% on mobile platforms. This dominance, according to the ruling, was not due to the superiority of Google’s search engine alone but was significantly bolstered by anti-competitive practices.

Implications for Google

The ruling has far-reaching implications for Google and its parent company, Alphabet Inc. The company could face substantial penalties and be forced to alter its business practices. This might include breaking up parts of its business or changing how it negotiates deals with other companies. However, Google has issued a statement announcing its intention to appeal the decision. Google stated that the public prefer using the Google search engine due to its popularity and ease of use and not due to its anti-competitive behaviour.

The tech industry has been closely watching this case, as it could set a precedent for future antitrust actions against other tech companies such as Amazon, Apple, and Facebook. Many industry experts believe that this ruling could lead to increased scrutiny of other dominant players in the tech sector.

The broader impact on consumers and the market

For consumers, the ruling could lead to more choice in search engines and potentially lower prices for online advertising. However, there are concerns that changes to Google’s business model could disrupt the services that millions of people rely on daily. This decision also raises a question mark over the future of digital marketing which is dominated by Google.   

The legal battle is far from over. Google’s appeal process could take years, and the final outcome remains uncertain. However, this ruling is a clear signal that regulators are serious about reining in the power of Big Tech. It also underscores the importance of maintaining competitive markets in the digital age.

The case against Google is a pivotal moment in the struggle to balance innovation with fair competition. While the immediate effects of the ruling are still unfolding, its long-term impact could reshape the tech industry and redefine how we interact with digital services.