The anti-trust lawsuit, filed by US Attorney General Merrick Garland against Google, can come as little surprise to Google; others in the ‘Big Tech Tent’ should take careful note.
In October 2020 the House Judicial Sub Committee published its report on the ‘Big Four’ and, frankly, it was damning. The findings were summarised by Val Demings (Democrat- Florida) as follows:
“Our investigation revealed an alarming pattern of business practices that degrade competition and stifle innovation,”
and continued:
“Competition must reward the best idea, not the biggest corporate account. We will take steps necessary to hold rulebreakers accountable.”
Amazon, Facebook, Apple, and Google were singled out by name for their conduct. However, despite what many regarded in the House’s report as a ‘Final Warning’, no heed was taken. And so, yesterday, 24.01.2023, the US Justice Department and eight States filed suit.
Mr Garland stated:
“For 15 years, Google has pursued a course of anticompetitive conduct that has allowed it to halt the rise of rival technologies, manipulate auction mechanics, to insulate itself from competition, and force advertisers and publishers to use its tools”.
The suit is some 140 pages and is filed in the Eastern District of Virginia.
In short, the tech giant is accused of buying up competitors (see for example Google’s 2017 purchase of Doubleclick). It is also accused of forcing advertisers using its platform to pay 30% to Google of each dollar going from advertisers to website publishers. The result was higher prices to consumers.
In its initial comments on the suit, Google has stated that it does not hold a monopoly in the relevant market. Respectfully, this is disingenuous. Google’s position is quite true, but insofar as it suggests that a monopoly position is required under US anti-trust law and it further implies that Google does not hold a dominant position.
In fact, Google accounts for 29% of the online advertising market, Meta controls 20% and Amazon brings up the rear with 11% (SOURCE: INSIDER INTELLIGENCE).
The US DoJ is claiming some £21.6bn in fines and penalties.
On an initial reading of the case, it seems to this writer that the case against Google has merit.
For more information about anti-trust lawsuits, or if you have any questions about any of the issues covered in this update, please contact Dispute Resolution Partner Jonathan Compton.