Why the US Courts are Threatening to Break up Google
As digital transformation snowballs across the world, the technology industry has become one of the most powerful in the world, but now it faces the consequences.
Technology giants have gained great power as well as responsibility, with the utilisation and demand of technology worldwide, from people using search engines everyday, to gene-editing technology to help people with an array of genetic disorders.
Yet such enormous and rapid change and potential of the tech sector is causing governments worldwide to grapple with keeping up with technological adaptations, how to regulate digital monopolies and how to foster fair competition.
The US, home to many of the world's largest tech firms, has taken a significant step in this direction that could go down in history.
It has laid an antitrust case against Google.
Why has Google's search dominance been questioned?
On Tuesday, US District Judge Amit Mehta ruled that Google, a subsidiary of Alphabet, illegally monopolised the search market through exclusive agreements worth billions with device manufacturers and web browsers.
They claim these deals made Google the default search engine on most devices, effectively blocking competitors like Microsoft's Bing or DuckDuckGo.
The Department of Justice (DOJ) is now considering severe measures, including potentially forcing Google to divest key assets.
These include:
- Chrome: Google's popular web browser
- Android: The widely-used mobile operating system
The DOJ argues these products help Google maintain its search market dominance, which accounts for over 90% of worldwide searches.
The judge found that Google's practices allowed it to charge inflated prices for search text advertisements, generating monopoly profit.
"Fully remedying these harms requires not only ending Google's control of distribution today, but also ensuring Google cannot control the distribution of tomorrow," the DOJ says.
What does this case mean for the global tech industry?
Google handles approximately 90% of US internet searches, meaning that the verdict of this case could send ripples throughout the whole technology industry.
However, Reuters states that Google plans to appeal the decision.
In a blog post, the tech giant stated that the proposals were "radical" and "go far beyond the specific legal issues in this case."
Yet, this case against Google is part of a larger and growing trend of increased antitrust scrutiny of multiple major technology companies.
The DOJ has also filed cases against other tech giants, including Meta Platforms (formerly Facebook), Amazon.com and Apple, also alleging illegal monopoly maintenance.
According to Reuters, some of the ideas in the DOJ’s proposals have previously received support from Google's smaller competitors.
What does this case mean for AI and future technologies?
The DOJ has proposed remedies that also aim to prevent Google's past dominance from extending into emerging technologies, particularly in the field of AI.
Prosecutors have suggested making available to rivals the indexes, data and models Google uses for its search and AI-assisted search features.
However, Google has expressed concerns about these AI-related proposals, stating they could hinder the sector's growth: "There are enormous risks to the government putting its thumb on the scale of this vital industry — skewing investment, distorting incentives, hobbling emerging business models — all at precisely the moment that we need to encourage investment.”
As the case progresses, it will likely set important precedents for not just how governments worldwide approach the regulation of large technology companies, but also about the future of them and their potential, keeping a close eye on emerging technologies like AI.
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