Justice Department Sues Google For Search Anticompetitive Business Practices

The U.S. Justice Department will file an antitrust lawsuit Tuesday against Google that alleges the company engaged in anticompetitive conduct in order to preserve monopolies in search and search advertising.

The suit is the "most aggressive U.S. legal challenge to a company's dominance in the tech sector in more than two decades," reportsThe Wall Street Journal, citing senior Justice officials.

The DOJ claims Alphabet's business maintains its status as "gatekeeper to the internet through an unlawful web of exclusionary and interlocking business agreements." Through those agreements, smaller companies have been shut out.

Eleven states also joined the lawsuit.



The claim alleges that Google uses billions of dollars from online advertising, as well as deals with Apple's Safari, which acts as the company's default search engine.

The lawsuit also looks at preloaded arrangements for Google’s search application when it cannot be changed or deleted on mobile phones running its Android operating system.

The government will allege that Google prohibits competitors’ search applications from being preloaded on phones under revenue-sharing arrangements.

A loss for Google likely means the court will order changes to the way it conducts business, rather than a breakup.

It's not entirely clear how this will impact online advertising in the United States. “The DOJ will attack Google's position as a ‘walled garden’ for digital advertising,” said Greg Sterling, vice president of market insights at Uberall. “This is where it may have more success than in consumer search, which is where many of Google's rivals are focused. However, it will depend entirely on the shape and particulars of any settlement or trial. I do expect that there will be meaningful concessions by Google at a bare minimum.”

A similar claim in Europe forced Google to develop what it calls a choice screen auction on phones that allow users to choose from a handful of browsers and search engines.  

Sterling said the European approach to antitrust has had a limited impact on Google's market power in Europe. The strength of the DOJ's case is uncertain, since the agency pushed to file before the election. It asks for "structural relief," he says, but doesn't explicitly seek a breakup, for now. The potential change in administrations could affect the case, as happened with Microsoft years ago. 

The change in Europe was made to comply with the European Commission's ruling. The EU fined Google, saying it had an unfair advantage by pre-installing its Chrome browser and Google search app on Android smartphones and notebooks.

Microsoft's Bing won some key slots in Google’s search auction, allowing the company to appear as a download prompt on new phones running Android in Germany, Sweden, Spain, the United Kingdom and France, among others.

Privacy engine DuckDuckGo published an open letter last week asking Google why the process to make DuckDuckGo Search or any other alternative the default on Android devices takes more than 15 clicks.

The letter states that Google has a “one click” stance on helping find the correct information, but when it comes to allowing users to use the browser or search engine from a competitor, it takes 15 clicks.

Google search is made the default on Android devices in two ways -- through the home-screen search bar and default browser. The post walks through the process in which people can change both preferences.

In Google’s European auction, DuckDuckGo won eight slots in smaller markets. The search engine info.com won slots on a choice screen for new Android phones in all 31 countries, PrivacyWall won slots in 22 countries, and GMX won slots in 16 countries.

Next story loading loading..