The suit against Google — scheduled for trial at the D.C. District Court on September 12 — focuses on the company’s search engine and monopoly power.
Upcoming Google Antitrust Trial Could Have Widespread Impacts on the Internet as We Know It
It’s a huge sign of progress that the DOJ felt strongly enough about these problems to bring this case forward. But we'll need Congress in the end to address the outsized power of Google and other dominant monopolies.
Starting next week, an incredibly important antitrust trial determining the market structure of how we find information on the web will begin. More than 10 years ago, competitors and potential competitors to Google Search complained that Google was using its power in the search market to block any other company from being able to compete fairly against Google. Finally, in 2020, the Department of Justice agreed, filing a lawsuit against Google for antitrust violations, specifically monopoly maintenance in violation of the Sherman Act. This suit is part of a broader awakening of the antitrust community to the special economics of platform markets and the competition problems that we face there.
The suit against Google — scheduled for trial at the D.C. District Court on September 12 — focuses on the company’s search engine. According to the DOJ, Google used a series of exclusive agreements and leveraged its position in the related markets of mobile phone operating systems and web browsers to build and maintain a monopoly in search and search advertising. The dominance of Google Search can be measured as a market share: Google has 88% of the search market according to the Department of Justice suit. But it’s also helpful to think about the dominance of the Google search engine intuitively from a user experience perspective. For less sophisticated users, Google is the internet. Many people don’t know that they are accessing the internet through a browser; they are just accessing the internet through Google. For these users, every website visit begins with a Google search — not using bookmarks or typing in URLs.
In this context, it becomes very difficult to envision what a competitive marketplace in search would look like. What new innovations in search have we missed out on because no one has been able to apply competitive pressure on Google’s search engine for the last 15 years? How might we be accessing information online today if there had been vigorous competition in search? Would it be easier to find what we’re looking for? Would it be easier to assess the reliability of online sources? Is it possible different users have different preferences for a search engine? Would consumer choice allow some differentiation of products that we could choose from based on our own distinct needs?
Instead, Google Search has been optimizing its search engine results page for you to click on ads instead of the links that it thinks are most relevant for users. And it’s not just our experience on Google.com that is impacted by this lack of competition. Websites across the internet have been built to optimize for this one algorithm due to Google’s extreme dominance in search. Google, of course, doesn’t share the details of its search algorithm, but the company does share some high-level characteristics of websites that do well. In fact, an entire industry, “search engine optimization,” has sprung up around helping people build their websites to rank higher in Google Search. Many characteristics of the web today resulted from Google’s algorithm choices. For instance, people blame food bloggers for forcing us to wade through long, boring stories just to scroll to a recipe, when we should really blame Google for preferring (and rewarding) that type of content in the first place. What content are we missing out on because so many websites and publishers are designing our web experience to meet Google’s own predictions of what users will click on?
In 2012, the Federal Trade Commission investigated Google for antitrust violations related to its search engine. At that time, the agency declined to bring a lawsuit. Accidentally leaked documents from inside the agency seemed to indicate that the FTC staff were concerned, but were overruled by agency leadership, but it’s difficult to get a clear picture of the non-public back-and-forth that may have gone on inside the agency. Thinking back to where antitrust law and thinking was at that time, I have to admit, I wasn’t surprised by the result. Antitrust enforcers at that time were focused on older monopolists like Microsoft. And many antitrust economists believed that the fact that the search engine was free was a strong indicator that the market was competitive.
An argument I remember distinctly from that era was: “Competition is just a click away.” Compared to traditional industries, where switching costs were obvious and high (shipping your chemical input to a different pharmaceutical factory; shopping at a grocery store that’s five minutes farther away; and so on), the seemingly frictionless environment of the internet provided the illusion of choice. But market participants knew that the power of defaults was strong, even online. Today, it is clear: Competition is not one click away. To change your default search engine across your devices is a cumbersome process. And this change frequently reverts back to Google Search after software updates, requiring users to repeat their effort. It makes sense that defaults are powerful. Otherwise, why would Google pay Apple $1 billion a year (according to the DOJ suit) for the right to be the default search engine on the iPhone? And of course, businesses that rely on Google to reach customers can’t switch to a competitor, Google is where the users are, so businesses are stuck.
It’s a huge sign of progress that the DOJ felt strongly enough about these problems to bring this case forward. And the fact that Judge Mehta, who is presiding over the case, rejected Google’s summary judgment motion on these counts and allowed this case to proceed is another strong indicator. But even if this case is wildly successful and the court grants highly effective remedies to promote competition in the search engine market, that decision will not be an indication that our antitrust laws are as strong as we need them to be, or that sector-specific laws are not needed. In fact, Google’s dominance in search and its use of default contracts to protect that dominance is just one of several significant barriers to competition against dominant digital platforms. Congress has been working hard on addressing these problems as well, while we’ve been waiting for this one case to work its way through the slow litigation process. Congress will still need to act to fully address the power of dominant digital platforms, regardless of the outcome.
FINAL DAY! This is urgent.
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Starting next week, an incredibly important antitrust trial determining the market structure of how we find information on the web will begin. More than 10 years ago, competitors and potential competitors to Google Search complained that Google was using its power in the search market to block any other company from being able to compete fairly against Google. Finally, in 2020, the Department of Justice agreed, filing a lawsuit against Google for antitrust violations, specifically monopoly maintenance in violation of the Sherman Act. This suit is part of a broader awakening of the antitrust community to the special economics of platform markets and the competition problems that we face there.
The suit against Google — scheduled for trial at the D.C. District Court on September 12 — focuses on the company’s search engine. According to the DOJ, Google used a series of exclusive agreements and leveraged its position in the related markets of mobile phone operating systems and web browsers to build and maintain a monopoly in search and search advertising. The dominance of Google Search can be measured as a market share: Google has 88% of the search market according to the Department of Justice suit. But it’s also helpful to think about the dominance of the Google search engine intuitively from a user experience perspective. For less sophisticated users, Google is the internet. Many people don’t know that they are accessing the internet through a browser; they are just accessing the internet through Google. For these users, every website visit begins with a Google search — not using bookmarks or typing in URLs.
In this context, it becomes very difficult to envision what a competitive marketplace in search would look like. What new innovations in search have we missed out on because no one has been able to apply competitive pressure on Google’s search engine for the last 15 years? How might we be accessing information online today if there had been vigorous competition in search? Would it be easier to find what we’re looking for? Would it be easier to assess the reliability of online sources? Is it possible different users have different preferences for a search engine? Would consumer choice allow some differentiation of products that we could choose from based on our own distinct needs?
Instead, Google Search has been optimizing its search engine results page for you to click on ads instead of the links that it thinks are most relevant for users. And it’s not just our experience on Google.com that is impacted by this lack of competition. Websites across the internet have been built to optimize for this one algorithm due to Google’s extreme dominance in search. Google, of course, doesn’t share the details of its search algorithm, but the company does share some high-level characteristics of websites that do well. In fact, an entire industry, “search engine optimization,” has sprung up around helping people build their websites to rank higher in Google Search. Many characteristics of the web today resulted from Google’s algorithm choices. For instance, people blame food bloggers for forcing us to wade through long, boring stories just to scroll to a recipe, when we should really blame Google for preferring (and rewarding) that type of content in the first place. What content are we missing out on because so many websites and publishers are designing our web experience to meet Google’s own predictions of what users will click on?
In 2012, the Federal Trade Commission investigated Google for antitrust violations related to its search engine. At that time, the agency declined to bring a lawsuit. Accidentally leaked documents from inside the agency seemed to indicate that the FTC staff were concerned, but were overruled by agency leadership, but it’s difficult to get a clear picture of the non-public back-and-forth that may have gone on inside the agency. Thinking back to where antitrust law and thinking was at that time, I have to admit, I wasn’t surprised by the result. Antitrust enforcers at that time were focused on older monopolists like Microsoft. And many antitrust economists believed that the fact that the search engine was free was a strong indicator that the market was competitive.
An argument I remember distinctly from that era was: “Competition is just a click away.” Compared to traditional industries, where switching costs were obvious and high (shipping your chemical input to a different pharmaceutical factory; shopping at a grocery store that’s five minutes farther away; and so on), the seemingly frictionless environment of the internet provided the illusion of choice. But market participants knew that the power of defaults was strong, even online. Today, it is clear: Competition is not one click away. To change your default search engine across your devices is a cumbersome process. And this change frequently reverts back to Google Search after software updates, requiring users to repeat their effort. It makes sense that defaults are powerful. Otherwise, why would Google pay Apple $1 billion a year (according to the DOJ suit) for the right to be the default search engine on the iPhone? And of course, businesses that rely on Google to reach customers can’t switch to a competitor, Google is where the users are, so businesses are stuck.
It’s a huge sign of progress that the DOJ felt strongly enough about these problems to bring this case forward. And the fact that Judge Mehta, who is presiding over the case, rejected Google’s summary judgment motion on these counts and allowed this case to proceed is another strong indicator. But even if this case is wildly successful and the court grants highly effective remedies to promote competition in the search engine market, that decision will not be an indication that our antitrust laws are as strong as we need them to be, or that sector-specific laws are not needed. In fact, Google’s dominance in search and its use of default contracts to protect that dominance is just one of several significant barriers to competition against dominant digital platforms. Congress has been working hard on addressing these problems as well, while we’ve been waiting for this one case to work its way through the slow litigation process. Congress will still need to act to fully address the power of dominant digital platforms, regardless of the outcome.
- The Public Needs Transparency in US v. Google Trial ›
- DOJ Suit Against Google Heralded as Among 'Most Important Antitrust Cases' in US History ›
Starting next week, an incredibly important antitrust trial determining the market structure of how we find information on the web will begin. More than 10 years ago, competitors and potential competitors to Google Search complained that Google was using its power in the search market to block any other company from being able to compete fairly against Google. Finally, in 2020, the Department of Justice agreed, filing a lawsuit against Google for antitrust violations, specifically monopoly maintenance in violation of the Sherman Act. This suit is part of a broader awakening of the antitrust community to the special economics of platform markets and the competition problems that we face there.
The suit against Google — scheduled for trial at the D.C. District Court on September 12 — focuses on the company’s search engine. According to the DOJ, Google used a series of exclusive agreements and leveraged its position in the related markets of mobile phone operating systems and web browsers to build and maintain a monopoly in search and search advertising. The dominance of Google Search can be measured as a market share: Google has 88% of the search market according to the Department of Justice suit. But it’s also helpful to think about the dominance of the Google search engine intuitively from a user experience perspective. For less sophisticated users, Google is the internet. Many people don’t know that they are accessing the internet through a browser; they are just accessing the internet through Google. For these users, every website visit begins with a Google search — not using bookmarks or typing in URLs.
In this context, it becomes very difficult to envision what a competitive marketplace in search would look like. What new innovations in search have we missed out on because no one has been able to apply competitive pressure on Google’s search engine for the last 15 years? How might we be accessing information online today if there had been vigorous competition in search? Would it be easier to find what we’re looking for? Would it be easier to assess the reliability of online sources? Is it possible different users have different preferences for a search engine? Would consumer choice allow some differentiation of products that we could choose from based on our own distinct needs?
Instead, Google Search has been optimizing its search engine results page for you to click on ads instead of the links that it thinks are most relevant for users. And it’s not just our experience on Google.com that is impacted by this lack of competition. Websites across the internet have been built to optimize for this one algorithm due to Google’s extreme dominance in search. Google, of course, doesn’t share the details of its search algorithm, but the company does share some high-level characteristics of websites that do well. In fact, an entire industry, “search engine optimization,” has sprung up around helping people build their websites to rank higher in Google Search. Many characteristics of the web today resulted from Google’s algorithm choices. For instance, people blame food bloggers for forcing us to wade through long, boring stories just to scroll to a recipe, when we should really blame Google for preferring (and rewarding) that type of content in the first place. What content are we missing out on because so many websites and publishers are designing our web experience to meet Google’s own predictions of what users will click on?
In 2012, the Federal Trade Commission investigated Google for antitrust violations related to its search engine. At that time, the agency declined to bring a lawsuit. Accidentally leaked documents from inside the agency seemed to indicate that the FTC staff were concerned, but were overruled by agency leadership, but it’s difficult to get a clear picture of the non-public back-and-forth that may have gone on inside the agency. Thinking back to where antitrust law and thinking was at that time, I have to admit, I wasn’t surprised by the result. Antitrust enforcers at that time were focused on older monopolists like Microsoft. And many antitrust economists believed that the fact that the search engine was free was a strong indicator that the market was competitive.
An argument I remember distinctly from that era was: “Competition is just a click away.” Compared to traditional industries, where switching costs were obvious and high (shipping your chemical input to a different pharmaceutical factory; shopping at a grocery store that’s five minutes farther away; and so on), the seemingly frictionless environment of the internet provided the illusion of choice. But market participants knew that the power of defaults was strong, even online. Today, it is clear: Competition is not one click away. To change your default search engine across your devices is a cumbersome process. And this change frequently reverts back to Google Search after software updates, requiring users to repeat their effort. It makes sense that defaults are powerful. Otherwise, why would Google pay Apple $1 billion a year (according to the DOJ suit) for the right to be the default search engine on the iPhone? And of course, businesses that rely on Google to reach customers can’t switch to a competitor, Google is where the users are, so businesses are stuck.
It’s a huge sign of progress that the DOJ felt strongly enough about these problems to bring this case forward. And the fact that Judge Mehta, who is presiding over the case, rejected Google’s summary judgment motion on these counts and allowed this case to proceed is another strong indicator. But even if this case is wildly successful and the court grants highly effective remedies to promote competition in the search engine market, that decision will not be an indication that our antitrust laws are as strong as we need them to be, or that sector-specific laws are not needed. In fact, Google’s dominance in search and its use of default contracts to protect that dominance is just one of several significant barriers to competition against dominant digital platforms. Congress has been working hard on addressing these problems as well, while we’ve been waiting for this one case to work its way through the slow litigation process. Congress will still need to act to fully address the power of dominant digital platforms, regardless of the outcome.
- The Public Needs Transparency in US v. Google Trial ›
- DOJ Suit Against Google Heralded as Among 'Most Important Antitrust Cases' in US History ›