The US Federal Court found Google to be a search engine monopolist in violation of antitrust laws. The company is accused of abusing its dominant position and artificially inflating advertising prices.
Google Monopoly
Judgment
The American federal court issued verdict that Google misused its monopoly position to exert significant influence over the entire search engine industry. The ruling comes as part of a lawsuit filed by the U.S. Department of Justice and several states in 2020.
Decision rationale
Judge Amit Mehta of the US District Court for the District of Columbia said in his decision: "Google is a monopolist and acted as a monopolist to maintain its monopoly. This is a violation of Section 2 of the Sherman Act."
The essence of the charges
The lawsuit alleged that Google took illegal actions to maintain its dominant position in the search engine industry. In particular, the company paid billions of dollars annually to giants such as Apple, Samsung and Mozilla to remain the default search engine on their devices and browsers. According to the Justice Department, Google controls about 90% of the web search market, making it difficult for competitors to achieve the scale needed to compete effectively.
Google Recognition
Judge Mehta noted that Google acknowledged that losing its status as the default search engine on various platforms would negatively impact its profits. The court's decision states: "Google predicts that the loss of Safari's default search engine position will lead to a significant reduction in search queries and billions in losses."
Google's Position
During the trial, Google insisted that its significant share of the search market was driven by a superior product, highly rated by users. Kent Walker, president of Global Affairs at Google, commenting on the court's decision, reiterated that the company offers the best search engine, which was recognized in the court decision.
Advertising and Monopoly
The Department of Justice also argued that Google has a monopoly on advertisements in search results. According to the department, the company artificially inflated advertising prices above the market level. Judge Mehta agreed that "Google exploited its monopoly power by charging hyper-competitive prices for general search text advertising, thereby generating monopoly profits." However, he noted that Google does not have monopoly power in the broad search advertising market.
Next steps
As of now, Judge Amit Mehta has not imposed any sanctions on Google. In the future, he may oblige the company to change its operating practices or even sell part of the business.
Glossary
- Google is an American multinational corporation specializing in Internet services and products
- Apple is an American technology company, a manufacturer of personal and tablet computers, smartphones and software
- Samsung is a South Korean company, one of largest electronics manufacturers in the world
- Mozilla is a free software organization best known for its Firefox web browser
- Safari - a web browser developed by Apple
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Discussion of the topic – Court decision: Google is recognized as a monopolist in the search industry
A US federal court ruled that Google illegally abused its monopoly in the search industry, violating antitrust laws. The decision was the result of years of litigation brought by the Department of Justice and several states.
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