Society

“Google’s Monopoly”

Introduction

After the Big Tech antitrust hearing, the four companies have still been investigated further. On Tuesday, October 20th, the Justice Department sued Google for violating antitrust laws as a monopoly. For reference, antitrust laws are regulations put in place to protect consumers from power-abusing companies, or in this case, monopolies. Monopolies, reminiscent of the board game, are companies that have essentially exclusive control over a trade or industry by being the sole provider of a product/service and use this power to set extremely high prices, while allowing no alternatives to compete. In other words, imagine playing a game of Monopoly against a player who controls every square and has a hotel on that property. Landing on any square worsens the cycle, as they build more buildings, siphoning more and more money from you. In the American Spirit, a free and competitive market was prioritized, resulting in the antitrust laws.

How Google Plans to Fight the Biggest U.S. Antitrust Suit Since Microsoft -  Bloomberg

Source: https://encrypted-tbn0.gstatic.com/images?q=tbn:ANd9GcSplYhE_moUBGUa4HzBw8MeVynBk_5Qk7Ygdg&usqp=CAU 

Context

As aforementioned in “Question Technology”, Bill Gates had experience in dealing with antitrust lawsuits. There are multitudes of parallels that can be drawn from the historic case almost 20 years ago. The Microsoft case was focused on the bundling of Internet Explorer(the best browser at the time) with their Windows OS, which would restrict options for other browsers, such as Netscape Navigator. When the decision was made, Microsoft did not have to split it up as the bundling was not deemed illegal, but its conditions imposed on PC makers was greatly restricted. Like the Microsoft case, the Google antitrust case will mainly be centered around the distribution of products/services.

A similar instance to the present antitrust case is Google’s fight with the EU’s antitrust rules. They were fined €1.49B, or ~$1.77B by the EU for abusing its market power to influence search advertisements on third-party websites. Google made agreements with third party websites to have exclusive search results, denying other companies advertising space. The EU deemed these actions illegal, and thus, fined Google. However, there are many other antitrust cases against Google, just from the EU: In June of 2017, Google was fined €2.42B for giving preferences to its own shopping services in the results. In July of 2018, Google was fined €4.34B for solidifying its dominance on Android mobile devices by pre-installing Google Search and Chrome to use the Play Store and more requirements to use their services.

Google fined $2.7BN for EU antitrust violations over shopping searches |  TechCrunch

Source: https://techcrunch.com/wp-content/uploads/2017/06/google-vs-eu.jpg 

Judgement

On Tuesday, the Justice Department accused Google of illegally being a monopoly in the search/search advertising industry. The agency accused Google of making exclusive deals with other giant tech partners and limiting competition to expand its power. The lawsuit could also start a chain reaction that causes even more antitrust lawsuits against Google and similar tech giants such as Apple, Amazon, and Facebook. 

“For many years, Google has used anticompetitive tactics to maintain and extend its monopolies in the markets for general search services, search advertising and general search text advertising – the cornerstones of its empire.”(Department of Justice)

The Department of Justice’s main conflict with Google is it’s exclusionary deals made with other tech giants to make their search engine the default option for users. This makes it extremely hard for other search engines to be exposed to users, and is deemed an anti competitive practice. 

For further reference, read the Department of Justice’s complaint(The language difficulty is easier than expected, with many explanation): https://www.justice.gov/opa/press-release/file/1328941/download 

Sources:

https://www.nytimes.com/2020/10/20/technology/google-antitrust.html

https://www.npr.org/2020/10/20/925736276/google-abuses-its-monopoly-power-over-search-justice-department-says-in-lawsuit

https://www.cnbc.com/2020/10/20/doj-case-against-google-has-strong-echoes-of-microsoft-antitrust-case.html

https://idm.net.au/article/0013190-vital-signs-googles-huge-market-share-doesnt-automatically-make-it

https://www.justice.gov/opa/pr/justice-department-sues-monopolist-google-violating-antitrust-laws

https://www.justice.gov/opa/press-release/file/1328941/download

https://ec.europa.eu/commission/presscorner/detail/en/IP_19_1770

https://www.theguardian.com/commentisfree/2020/oct/21/google-antitrust-monopoly-power-us-politics

https://techcrunch.com/wp-content/uploads/2017/06/google-vs-eu.jpg

Categories: Society