'Google is a cheater': US Justice Dept accuses tech giant of 'manipulation' to dominate search

Google spent $10 billion to prevent smaller competitors from gaining traction

Web Desk
A logo is pictured at Googles European Engineering Center in Zurich, Switzerland July 19, 2018.—Reuters
A logo is pictured at Google's European Engineering Center in Zurich, Switzerland July 19, 2018.—Reuters 

The United States Justice Department has asserted that Google violated regulations in its pursuit of maintaining dominance in online search by investing $10 billion to prevent smaller competitors from gaining traction.

"This case is about the future of the internet," said Kenneth Dintzer, arguing for the Justice Department that Google began in 2010 to illegally maintain its monopoly.

According to the Justice Department's claims, Google paid billions annually to device manufacturers like Apple, wireless firms like AT&T, and browser developers like Mozilla. These payments were intended to secure a market share of about 90% for Google's search engine.

Furthermore, Dintzer contended that Google manipulated ad auctions on the internet to inflate advertising costs for advertisers. "Defaults are powerful, scale matters and Google illegally maintained a monopoly for more than a decade," said Dintzer. This, he argued, resulted in reduced innovation by Google and less focus on other concerns like privacy.

Dintzer also stated that the Justice Department uncovered evidence suggesting that Google had taken measures to safeguard communications regarding the payments it made to companies such as Apple. He mentioned that Google was aware these agreements violated antitrust regulations.

During the trial, Dintzer presented a chat in which Google CEO Sundar Pichai requested the history of a particular chat to be disabled.

Google's defense is straightforward. It maintains that its substantial market share is not the result of illegal actions but rather due to being a fast and efficient search engine, which it provides for free. 

Google's lawyers argue that consumers can easily remove the Google app from their devices or use an alternative search engine like Microsoft's Bing, Yahoo, or DuckDuckGo by typing it into a browser.

They contend that consumers continue to choose Google because they rely on it for answers and are satisfied with its performance.

The trial, with opening arguments held in a Washington, DC federal court, is expected to last up to 10 weeks, featuring two phases. Initially, Judge Amit Mehta will determine whether Google has violated antitrust law in its management of search and search advertising.

If Google is found to have breached the law, Judge Mehta will then determine the appropriate course of action to address it. This could involve ordering Google to cease illegal practices or divesting assets.

While the government's complaint seeks "structural relief as needed," it does not specify the exact remedy.

The outcome of this legal battle carries significant implications for the tech industry, which has faced allegations of acquiring or stifling smaller competitors while shielding itself from antitrust accusations due to the free or low-cost nature of the services it offers. 

Notable antitrust trials in the past include those involving Microsoft in 1998 and AT&T in 1974, with the AT&T case ultimately leading to the development of the modern cell phone industry and the Microsoft case paving the way for companies like Google on the internet.