DIGIVESTASI - The global internet giant, Google, has been found guilty of monopolistic practices by making its search engine the default on various browsers and smartphones worldwide. This decision is the result of a legal process.

The antitrust case against Google is reminiscent of a similar situation faced by Microsoft in 1999. At that time, a federal judge ruled that Microsoft illegally used its dominance in the Windows operating system to crush its rival browser, Netscape Navigator. The case was settled in 2001, forcing Microsoft to cease practices that harmed competitors in deals with PC manufacturers.

The case against Google, filed by the government in 2020, focuses on allegations that the search engine giant built a 'wall' to block competition in the internet search industry in order to maintain its dominance.

"The end result is not much different from the court's decision regarding Microsoft in the browser market," wrote Judge Amit Mehta in a 300-page ruling, as quoted by CNBC International on Saturday (August 10, 2024).

Mehta highlighted the similarities between the Google and Microsoft cases, particularly concerning the "power of default services." Google has spent billions of dollars annually to ensure its search engine remains the default on devices like iPhones and Samsungs.

"Users can technically choose another search engine, but very few do," Mehta added.

Further hearings are scheduled for September 4 to determine the remedies and penalties that Google will face. At this stage, Google may file an appeal, a process that experts say could take up to two years. Microsoft itself previously filed an appeal before ultimately reaching a settlement with the Department of Justice (DOJ).

Sam Weinstein, a law professor at Cardozo Law School and former antitrust official at the DOJ, stated that the government clearly based this case on the Microsoft case.

In the Microsoft case, Judge Thomas Penfield Jackson found that the company forced PC manufacturers to include Internet Explorer in Windows and threatened penalties if they installed or promoted Navigator.

Nicholas Economides, a professor of economics at the Stern School of Business at New York University, sees a clear resemblance in the Google case.

"My initial reaction is that Google seems to be losing overall," said Economides. "It reminds me of the DOJ's big win against Microsoft," he added.

Google's Future
Some legal experts predict that the court may require Google to cancel all its exclusive agreements, making it easier to access other search engines, and possibly impose financial penalties. The biggest risk is if Google has to change its business model, which has long relied on being the default in browsers and smartphones.

In the second quarter of 2024, Google Search and other services contributed 57% of Alphabet's total revenue. In its appeal, Google may emphasize that artificial intelligence (AI) plays a significant role in market competition, something that did not exist when the DOJ first filed the lawsuit.

However, Google has tried to downplay the importance of AI since the emergence of ChatGPT from OpenAI.

Neli Chilson, a former chief technologist for the FTC and now head of AI policy at the Abundance Institute, stated that increased competition due to AI could help Google win this case.

"The rigid market definition led the court to rule that Google illegally maintained a monopoly in general search," said Chilson. However, "vertical search providers" like Amazon and AI services like ChatGPT "threaten to change Google's general search advertising business model," she concluded.

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