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In a pivotal moment for the tech giant, Google is bracing for the largest antitrust trial in the United States in a quarter-century. Commencing on Tuesday, federal regulators are launching an effort to dismantle Google’s internet empire.
Allegations of Market Manipulation
Over the next ten weeks, federal lawyers and state attorneys general will endeavor to demonstrate that Google manipulated the market to its advantage by securing its search engine as the default option across various platforms and devices. A ruling from U.S. District Judge Amit Mehta is not expected until early next year. If Google is found guilty, a subsequent trial will determine the necessary measures to curb the dominance of this California-based tech giant.
Key Testimonies Awaited
The trial will feature high-profile testimonies from top executives at Google and its parent company, Alphabet Inc. Among them, Alphabet CEO Sundar Pichai, who took over from Google co-founder Larry Page, is expected to appear. Court documents also suggest that a prominent Apple executive, Eddy Cue, may be called to the stand.
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Origins of the Lawsuit
The U.S. Justice Department initiated this antitrust lawsuit against Google nearly three years ago during the Trump administration. The lawsuit alleges that Google unfairly leveraged its internet search dominance against its competitors. Government lawyers claim that Google achieves this through payola, spending billions annually to secure its position as the default search engine on various platforms, including iPhones and web browsers like Apple’s Safari and Mozilla’s Firefox.
Google’s Defense
Google counters these allegations by pointing out that it faces competition on multiple fronts, even though it commands around 90% of the internet search market. Google argues that competitors range from search engines like Microsoft’s Bing to websites like Amazon and Yelp, where consumers can seek recommendations.
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From Google’s perspective, its continuous improvements to the search engine have made it the go-to choice for users, cementing the term “Googling” as synonymous with online searches.
A Multibillion-Dollar Corporate Giant
The trial comes just a few weeks after celebrating the 25th anniversary of Google’s first investment, a $100,000 check from Sun Microsystems co-founder Andy Bechtolsheim. This initial investment allowed Google’s co-founders, Larry Page and Sergey Brin, to operate in a Silicon Valley garage.
Today, Alphabet, Google’s parent company, boasts a market value of $1.7 trillion and employs 182,000 people. The lion’s share of Alphabet’s revenue comes from annual ad sales, totaling $224 billion, facilitated through a digital services network anchored by Google’s search engine, which handles daily queries.
Parallels with Microsoft’s Antitrust Case
The U.S. Justice Department’s antitrust case against Google parallels the one it filed against Microsoft in 1998. In the past, regulators accused Microsoft of coercing computer manufacturers to include Microsoft’s Internet Explorer as a bundled component alongside its dominant Windows operating system, effectively stifling competition from Netscape Navigator.
Interestingly, several Justice Department’s legal team members involved in the Google case, including lead litigator Kenneth Dintzer, also participated in the Microsoft investigation.
Potential Consequences for Google
The outcome of this trial could have far-reaching consequences for Google. If found guilty, Google might be compelled to cease payments to companies like Apple to secure its position as the default search engine on smartphones and computers. Alternatively, the legal battle could lead to a loss of focus for Google, as was the case with Microsoft following its antitrust clash with the Justice Department. This distraction allowed Google to evolve from a startup into a formidable industry leader.
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