Department of Justice Files Antitrust Lawsuit Against Google
The U.S. Department of Justice filed an antitrust lawsuit Tuesday against Google in Federal Court in Washington, D.C. The lawsuit accuses the company of using its dominance in search and online advertising to illegally protect its monopoly.
Much of the lawsuit focuses on exclusive contracts Google has established with other tech giants, such as Apple. Google currently pays Apple billions of dollars per year to keep Google as the default search engine on the iPhone. Users can change this setting, but few do – and so the default option is extremely lucrative for Google.
Google has fought similar lawsuits in the European Union and elsewhere around the globe, but this U.S. lawsuit stands out, since it is the first major antitrust lawsuit brought by the Federal government since the Microsoft lawsuit of the late 1990s.
Google controls more than 90% of the search market, which brought the company $34.3 billion in revenue in the U.S. alone. This figure is expected to grow to $42.5 billion by 2022.
Google is likely to argue that while it is large, it does not have a monopoly on either search or online advertising. The company is likely to note that other marketplaces, such as Amazon, are large competitors in the space and show that consumers still have options.
For instance, more than half of all online retail searches begin on Amazon.com, not on Google.
While this week’s announcement is major, it is important to note that this litigation will take years to resolve. The Microsoft antitrust lawsuit took more than a decade to resolve. Importantly, this case from the DOJ could set off a cascade of similar lawsuits by individual states and states Attorneys General accusing Google of similar anticompetitive practices.
For everyday consumers – and even businesses who advertise on Google or rely on its products to help their marketing – this week’s announcement by the Justice Department is unlikely to change anything in the near future.
It will be interesting to see how this all plays out, but Google’s users are unlikely to notice any changes.
Google’s leadership has told employees to keep focusing on building great experiences for users, and there is little reason to believe that anything related to Google products will change until the lawsuit is resolved.
We are years away from any meaningful changes as a result of this case, but it still holds an interesting lesson for businesses that rely on Google. The lesson is to not put all of your eggs in one basket, no matter how large the platform or how dominant the company. As with everything in marketing, results and regulations are subject to change.
Google certainly isn’t going away anytime soon, but the company and its services may look different in the future should the government win its lawsuit. But it’s going to take a long time to get there.