On 5th August, 2024 the US Department of Justice engaged in a lawsuit against Google over an alleged “illegal” monopolisation of the search market. Antitrust lawsuits like these are designed to protect consumers by ensuring fair competition and preventing unfair business practices.
The Google vs DOJ case centres around three key issues:
- Market Dominance – Google has always dominated the competition. Their global market share has been around 90%, while their closest competitor Bing retains around 7%. Google’s dominance is never more ironically demonstrated than through “Google” being the most searched query on Bing.
- Anticompetitive Practices – According to reports, Google had engaged in illegal practices to suppress competing search engines, such as Bing and DuckDuckGo. This was mostly through contractual agreements with smartphone manufacturers like Apple positioning Google as their default search engine.
- Monopolist Status – Google not only provides search facilities but has a connected suite of tools including Chrome, Google Ads, Analytics, and Tag Manager. This has been deemed to demonstrate monopoly power. This has caused Google to be in violation of Section 2 of the Sherman Act, which bars businesses from monopolising, attempting or conspiring to monopolise commerce.
So with the outcome of this antitrust case yet to be determined, what could this mean for the future of search?
PRECEDENT
Before we dig into the potential outcomes, we should review some previous antitrust cases against tech giants.
DOJ VS MICROSOFT
In the late 90s, the US Department of Justice sued Microsoft for its engagement in anti-competitive practices in the PC operating system market.
Microsoft was accused of bundling its IE web browser with the Windows OS to stifle competition from Netscape’s Navigator browser. The company had allegedly used its dominance to pressure PC manufacturers into exclusive agreements.
In 2000, the court ruled Microsoft to split into two separate units. However, this ruling was overturned on appeal. A settlement was reached in 2001, where Microsoft agreed to share its APIs with third-party companies.
This was an important case within the tech industry and influenced how many companies approach building and maintaining open platforms.
EUROPEAN UNION VS MICROSOFT
Similar to the DOJ case against Microsoft, the European Commission fined Microsoft for abusing its dominant market position in Europe. Much like the bundling of IE, the EU accused Microsoft of bundling its Windows Media Player with its Windows OS.
The outcome resulted in Microsoft facing fines totalling over €2 billion. They also agreed to offer a version of Windows without Windows Media Player for EU customers.
DOJ VS AT&T
Between the 70s and 80s, the DOJ filed an antitrust lawsuit against AT&T, which at the time had been deemed to have a monopoly over the telecommunications services in the U.S. AT&T was the country’s main telephone provider and held control over the country’s communication infrastructure.
The DOJ wanted AT&T to give up ownership of one of its subsidiaries that produced much of the company’s equipment. AT&T proposed breaking up the company, and the DOJ agreed.
The breakup created competition and innovation in the telecommunications industry, paving the way for the growth of mobile and internet services.
Whilst previous cases provide an indication as to what potential outcomes could be for Google, these types of lawsuits are complex and can evolve.
GOOGLE TAKES ON THE DOJ
In October 2024, Google’s VP of Regulatory Affairs published an article highlighting their take on the ‘significant unintended consequences for consumers, businesses, and American competitiveness’ posed by the DOJ’s lawsuit. It outlines:
- By demanding that Google shares user search data with competitors such as queries, clicks and results, users’ privacy and security could be put at risk.
- Hampering the development of Google’s AI tools stunts innovation and compromises America’s position as technological and economic leaders. Splitting business functions like Chrome and Android would fundamentally break them. As they are open-source models, many businesses depend on them, this action would likely be hugely detrimental to industry and consumers.
- Changing the online advertising market would throttle competition and decrease the value to publishers, merchants and consumers. Restricting Google’s ability to promote its search engine would cause friction for users who want to easily search for information.
Whilst Google’s defensive position seems strong, it is their perspective and these claims require independent verification.
POTENTIAL OUTCOMES
We can’t predict where this case will land, but we can consider some potential outcomes:
A BREAKUP OF GOOGLE SERVICES
- Accelerated Innovation
As we’ve seen with historical cases, a breakup of Google’s product functions is highly likely. A Forbes article (18th November 2024) cited a Bloomberg UK report outlining that having considered forcing Google to sell off Android, the DOJ is expected to request the federal judge to order Google to sell its Chrome web browser. It is believed that this may only be enforced should other aspects of the remedy not create a more competitive market.
The sale of Chrome would mark the loss of Google’s most valuable asset (61% of the US browser market) and an integral part of its advertising business. That said, it would likely yield a sale price of between $15-20 billion in light of its 3 billion monthly active users.
Whilst this would cause significant change, Google are well-positioned to navigate this given their previous Google / Alphabet product offering split. Should this be the end result, synergy between teams will be reduced and product upgrades will likely be slower to develop.
is. - A Conscious Uncoupling
It is expected that the antitrust enforcers will propose uncoupling Google’s Android smartphone operating system from their search and Play mobile app store. - The End of Exclusivity
By ending the exclusive search engine partnership agreements that Google currently has, users would be posed with more choices, increasing competition, which is the DOJ’s main objective. - Sharing is Caring
Google could be made to share its proprietary tech with competitors or disclose information about how its search algorithm works. They could also be required to license search engine results and data. Providing the ability for websites to opt out of their content being used by their AI products has also been discussed. That said, given that Google now displays AI Overviews at the top of search pages, to opt-out would have a detrimental effect on search rankings. - Financial Penalties
A likely outcome is that in any scenario, Google will face a significant financial penalty. - It all goes away…
It’s always possible that no violations are found, enabling Google to continue to trade with no changes or implications. It’s also possible that they could agree on a settlement with the DOJ before August’s final court ruling.
POTENTIAL IMPACT
Should the case go against Google, search marketing will be impacted both positively and negatively depending on your perspective.
Google’s dominance over search has been a constant. With more AI coming into search and some interesting competitors emerging with new features (Bing), the diversity of the landscape is changing.
- Accelerated Innovation
The pace of industry innovation may be expedited by competitors investing more in advanced search technologies and AI to capture market share. - Diversification
Users might begin exploring alternative search engines, leading to a more diversified search ecosystem. - Increased Competition
The end of Google’s exclusivity agreements could open the market to other search engines, fostering a more competitive environment. - Consumer Choice
With less market dominance, consumers will have more search engine and service options to choose from. - Default Settings
Device manufacturers and browsers may partner with different search providers, altering users’ default search settings. - Advertising Shift
Advertisers may spread their spending across multiple platforms, with increased competition potentially reducing advertising costs. - Greater Transparency
Google may be required to share more about its search algorithms, leading to increased industry-wide transparency.
Another factor worthy of consideration is that a change in the Presidency could bring a change in agendas, either expediting or diluting the end result. With the two week hearing currently set for April 2025 and the final ruling expected by August 2025, the clock is ticking. With a new president elected in the US, there is a chance that this case could unravel or come to an end sooner.
The reality is that the outcome of this trial could be a real game changer for search marketing and is one to monitor closely.