Anika Begay
Google is now 0-2 in antitrust cases. U.S. District Judge Amit Mehta ruled Monday that Google illegally maintained its dominance in search by using anticompetitive agreements to keep rivals from gaining ground. And without fear of pressure from competitors, Google was able to charge whatever it wanted for search ads, he said.
“The evidence at trial firmly established that Google’s monopoly power, maintained by its exclusive distribution agreements, enabled Google to raise prices for text ads without any significant competitive restraint,” Mehta wrote in a 286-page ruling. “The unfettered price increases fueled Google’s dramatic revenue growth and allowed it to maintain high and remarkably stable operating profits.”
His findings are perhaps the most comprehensive modern analysis of Google’s search business, which over the past 26 years has become a $175 billion annual revenue behemoth that accounts for a large portion of parent company Alphabet’s profits. Google will appeal, as it risks losing its prominent position on iPhones and other gateways to the web.
Kent Walker, Google’s president of global business, said in a statement that the company would challenge the ruling because it “recognizes that Google offers the best search engine, but concludes that we should not be allowed to make it easily available.”
U.S. Attorney General Merrick Garland called the decision “a historic victory.” Assistant Attorney General Jonathan Kanter said it “paves the way for innovation for generations to come.”
The ruling follows a weeks-long trial in Mehta’s courtroom last year in Washington, D.C., in which the U.S. Justice Department argued that Google became the world’s most popular search engine by paying partners like Apple and Samsung to promote it on their devices and software. Google attributed its success to providing the best service and argued that it faced significant competition from companies like Microsoft and others.
Mehta sided with Google on some issues, but rejected its general argument that the company had no illegal monopoly. Last year, a jury in federal court in San Francisco found Google’s Play app store an illegal monopolist.
How Google will have to adjust its business in light of the San Francisco and Washington rulings has yet to be determined. Mehta will hold a separate trial to determine remedies in the search case, and a judge is mulling proposed penalties in the Play case. Still, some of the changes Google has made in response to antitrust scrutiny in recent years have been costly.
First try
The case before Mehta dates back to the heightened oversight of the tech industry under then-President Donald Trump. The Justice Department sued Google in 2020 before Trump left office, and the case became the first of several against big tech companies to go to trial.
Mehta found that Google, with about 90 percent market share, has monopoly power in both general search and general search text ads. He found that Google’s agreements with partners hurt competition and that Google has not proven otherwise.
