Google is shelling out billions to illegally buy its dominance, US Department of Justice says

Ahead of an antitrust lawsuit against Google, which should begin next year, a first hearing has taken place. It allowed the parties to present their first arguments. Google is accused of paying billions to block competition out of certain devices.

It’s no secret that Google spends huge amounts of money to ensure that its search engine remains the default choice in many operating systems and products.

Billions… by default

However, the information takes a completely different turn when it is the American DoJ who says so and adds that the practice is not legal… According to the United States Department of Justice, each year, Google spends billions of dollars to pay Apple, Samsung and a few other telecom giants to illegally keep its search engine on the top step of the podium.

According BloombergKenneth Dintzer, general counsel for the DoJ, declined to disclose the amounts spent but described them as “huge amounts”. “Google is investing billions to make its browser the default choice, knowing that users don’t change the settings”he reportedly told Judge Amit Mehta, during a preliminary hearing in Washington, which was also attended by prosecutors from different states who are preparing an antitrust lawsuit against the Mountain View giant. “He buys exclusivity from the default setting, because it matters a lot »he would have continued.

Google sees competitors beyond online search

This session allowed the different parties to express themselves. For example, Google lawyers said the DoJ and states don’t understand the market and focus too much on smaller competing search engines, like Microsoft’s Bing or DuckDuckGo. According to his representative, Google faces competition from dozens of companies, such as ByteDance and its TikTok, Meta, or even Amazon.

“You don’t have to go to Google to buy from Amazon. You don’t have to go to Google to buy tickets on Expedia. »he reportedly said. “Just because Google doesn’t face the same competition on all queries doesn’t mean the company doesn’t face fierce competition. »

Furthermore, the representatives of the various parties have agreed on certain basic elements. Like the fact that the data generated by user queries is a key element for the success of a search engine. The various players present also agreed that Google controls the most widely used web browser, Chrome, and the second most popular mobile operating system, Android. This procedure focuses on the US market, which is dominated by iOS with 57.02% market share compared to around 43% for Android, according to figures from Statcounter in August 2022.

Google, a web access portal

Nevertheless, Kenneth Dintzer mainly focused on the mechanisms put in place by Google to make its search tool the default choice. According to him, this makes Google the ” gate “ by which most users go to the web and find sites there. These contracts prevent Google’s competitors from gaining power and growing. “Exclusivity of default choice allows Google to prevent rivals from accessing data [des utilisateurs, NDLR] ».

Google has another argument to defend itself on this point. According to its legal representative, the company has entered into agreements with companies like Apple, or even with browser developers like Mozilla since the early 2000s. However, the DoJ has so far failed to demonstrate how these agreements were problematic. This revenue sharing that Google offers has become essential for companies like Mozilla, which offer their products for free. “The reason they partner with Google is not because they have to, but because they want to”explained Google’s lawyer, stating that “competition on merit is not illegal”.

Over the years, and lawsuits, the tech giants often resort to the same types of arguments. To defend the model of its closed and exclusive App Store, Apple had chosen a similar argument. The trial, strictly speaking, is not expected to begin until next year. Other hearings should take place by then.

Source :

Bloomberg

Leave a Comment