The US Justice Department has filed an anti-trust lawsuit against Google in what is considered a landmark case against tech companies. Google is accused of “unlawfully maintaining monopolies in the markets for general search services, search advertising, and general search text advertising in the United States.”
The suit seeks to restrain Google and effect remedies for the damages caused by its conduct so far. Among the solutions being sought include fines, enforcing a divestment, or enforcing a change in business practices, or all of them.
The suit comes after a year long investigation of Google, where the tech giant is accused of locking up deals with favourable contracts and agreements with other tech companies such as Apple while throttling other competitors.
“Two decades ago, Google became the darling of Silicon Valley as a scrappy start-up with an innovative way to search the emerging internet. That Google is long gone. The Google of today is a monopoly gatekeeper for the internet, and one of the wealthiest companies on the planet.” The DOJ said.
Google has agreements with Apple, mobile carriers and other handset makers to make its search engine the default option for users. This ensures that the company has the dominant market share in search, the Department of Justice said, a figure that it put at around 80 percent.
“For many years,” the agency said in its 57-page complaint, “Google has used anticompetitive tactics to maintain and extend its monopolies in the markets for general search services, search advertising and general search text advertising — the cornerstones of its empire.”
The 64-page suit, filed in the U.S. District Court in the District of Columbia, has also been signed and supported by 11 states, all with Republican attorneys general: Texas, Arkansas; Florida; Georgia; Indiana; Kentucky; Louisiana; Michigan; Missouri; Montana; and South Carolina.
“Google is the gateway to the internet and a search advertising behemoth,” said Jeffrey A. Rosen, deputy attorney general in his statement. “Google achieved some success in its early years and no one begrudges that. But as the antitrust complaint filed today explains it has maintained its monopoly power through exclusionary practices that are harmful to competition. So the Justice Department has determined that an antitrust response is necessary to benefit consumers. If the government does not enforce the antitrust laws to enable competition, we could lose the next wave of innovation. If that happens, Americans may never get to see the next Google.”
Google said the suit is “deeply flawed” and reflects pent-up frustration toward a handful of tech companies- Google, Amazon, Apple and Facebook- that “have evolved from small and scrappy companies into global powerhouses with outsize influence over commerce, speech, media and advertising.”
Google has always denied accusations of antitrust violations, and the tech giant is expected to fight the government’s efforts using its global network of lawyers, economists and lobbyists. Google’s parent company, Alphabet, is valued at $1.04 trillion and with cash reserves of $120 billion, has fought other antitrust lawsuits in Europe.