What happened and why The US Department of Justice (DoJ) has been busy. In the most high profile antitrust case - since the US government took on Microsoft in the 90s - the DoJ has accused Google of suppressing competition, calling the tech giant a "monopoly gatekeeper of the internet". In the same week, that the DoJ forced Goldman Sachs to agree to pay nearly $3bn (£2.3bn) to end a probe of its role in the 1MDB corruption scandal, the American government has filed its biggest lawsuit against big tech in a generation. So what's this all about... Google Search... at the heart of the case is Google using deals with distributors, like mobile phone makers, to make sure Google is the default search engine for US customers.DoJ says... These exclusivity arrangements are central to the maintenance of its monopoly on search (i.e. 'Google-it'), and are preventing any rival from eating away at the business. And with those with memories strong enough to sense the similarities with the Microsoft case of the late 90s - Gates' biggest mistake - that because it is. If you'll excuse the history lesson for a moment... In 1998... The US govt. accused Microsoft of illegally maintaining its monopoly position in the PC market with restrictions manufacturers and users when it comes to uninstalling Internet Explorer and use other programs. By 2001, the court ruled that Microsoft's actions constituted unlawful monopolisation...That sets the precedent... with the Google case carrying direct parallels with the last time the US government went toe-to-toe with a tech giant. And at the heart of both the Microsoft case and the Google case, was securing a monopoly by using exclusivity arrangements and tying contracts, that push rivals out the market. 🤫 Wishing they laid low... and the DoJ was unsurprisingly keen to draw on those parallels between the two from the word go. In the lawsuit documentation, they're pretty explicit: "Back then Google claimed Microsoft's practices were anit-competitive and yet now, Google deploys the same playbook to sustain its own monopolies..." i.e. Same-same. But the Google lawsuit is also notable for what it left out - a lot. Mainly, no mention of Google’s dominance in the digital advertising. Some legal experts believe the narrow scope of the case plays into the hands of Google lawyers... especially since by focusing on the search engine, a product that is free to use and everyone uses. | The Takeaway On Tuesday, Google slammed the lawsuit “deeply flawed” and said it would “do nothing to help consumers”. Yep, its started. The tech giant - which operates under the Alphabet umbrella - argues that by signing exclusivity deals it gives away its Android operating system to device makers in return for carrying other Google products as default, and it helps bring the cost of those devices down. Basically a non-for-profit... 🙄 But even a Google loss could feel empty... When the EU found Google was illegally using its Android operating system to boost its search, the company was forced to hold auctions to decide which search platforms = more profit, same results.
