The tech world is digesting a potentially landmark ruling by a U.S. judge that Google illegally monopolizes online search and related advertising.
It’s taken four years to get to this point, and the inevitable appeal from Google owner Alphabet means the legal proceedings will likely drag on for some time to come.
But the possible consequences of the judge’s decision are already being evaluated, ranging from fines to other more complex remedies.
The US government specifically wants “structural aid” – what might that consist of?
Break up the band
The nuclear option would be to ask Google to break itself up into smaller pieces, a move that U.S. officials have not ruled out.
Google is much more than just search.
Just look at Android, a company bought for $50m (£39.3m) in 2005, which is now powered by the majority of smartphones, or YouTube, acquired for $1.65bn in 2006, which now generates annual revenues of many multiples of that figure.
One could argue that all of this can remain under Google, but that the actual search engine should be spun off into a separate business.
That may cause consternation for Alphabet executives. But as long as Google remains the default search engine on devices, the average consumer is unlikely to notice the difference.
“Such a move would certainly be met with years of litigation and legal battles, but it appears to be ‘on the table’ much more than at any other time in Google’s history,” said Gareth Mills, a partner at law firm Charles Russell Speechlys.
“There will now be a separate hearing where the judge will have no choice whether to consider divesting Google of some or all of its search engine business, or to impose other corporate governance controls to quash the anticompetitive conduct that has already occurred.”
Search it on Google
Another possible remedy relies on Google’s practice of paying other companies to use it.
The United States has claimed that Google pays huge sums of money every year to companies like Apple to be pre-installed as the default search engine on their devices or platforms.
The judge agreed.
The argument is that if Google had never spent that money, big companies might have been encouraged to develop their own search experience.
For example, Apple’s Safari browser uses Google by default whenever you use it to search the web.
If a corrective action significantly impacts Google’s ability to pay other companies to use it, perhaps those companies could start a competitor.
But here they would clash with Google’s incredibly strong customer recognition for search. Despite its high brand profile, it’s hard to imagine telling anyone “Apple” anything.
The iPhone maker will obviously be eager to keep pumping cash into Google, which one analyst estimated would be worth $20 billion in 2022.
“Any disruption to revenue streams will have significant implications for Apple,” said Dipanjan Chatterjee of Forrester Research.
“As the case moves through the legal system and the likely outcome appears to be the opening up of search engine exclusivity, one might expect a brand as obsessed with customer experience as Apple to have a Plan B to ensure a smooth transition for its customers.”
Difficult to move
An easier-to-imagine option is a choice screen where people opening a browser for the first time are asked whether they want to use Google or an alternative like Microsoft’s Bing.
However, it’s a little harder to imagine that this would lead to people abandoning Google en masse, for the simple reason that for most people it just works well.
Those of us with gray hair will remember that Google was one of many search engines that emerged in the early days of the Internet, with well-known rivals such as Yahoo and Ask (formerly AskJeeves) and perhaps lesser-known ones such as Lycos and AltaVista.
But over the next decade, Google didn’t just become the dominant player in the market—it became part of the way we talk.
Even though Microsoft launched its competitor, Bing, in 2009, nothing has yet managed to dislodge Google from its pedestal.
Microsoft boss Satya Nadella testified at Google’s trial, perhaps hoping that a ruling like this could finally help give Bing wings.
“The court may seek other ways to dismantle Google’s position as the default search engine, but some of those remedies likely go beyond the facts underlying this case,” said Columbia Law School Professor Anu Bradford.
“For example, the EU is going further with its recent Digital Markets Act, which even forces Google’s Android phones to present users with a ‘choice screen’ that lets them choose their preferred search engine when setting up their phone.
“One question is whether this new ruling will pave the way for similar regulatory demands in the future.”
Takes time
Whatever happens in the future, past experience suggests that it will not happen quickly.
In 1999, Microsoft found itself in a very similar situation to the one Google finds itself in today.
A US judge had just found that the company had created a monopoly and a year later a court had ordered its dissolution.
Microsoft appealed the decision, and in 2001 the initial decision to break it up was overturned.
By the end of 2002, Microsoft had reached a settlement with the U.S. Department of Justice, which was accepted by a judge.
But some American states did not agree and only in 2004, five years after the original ruling, was the agreement officially signed.