Google’s antitrust ruling bears resemblance to Microsoft monopoly case

[Pelican Press 0]

This is the hidden content, please

• Sign In
• or
• Sign Up

This is the hidden content, please

• Sign In
• or
• Sign Up

’s antitrust ruling bears resemblance to

This is the hidden content, please

• Sign In
• or
• Sign Up

monopoly case

This is the hidden content, please

• Sign In
• or
• Sign Up

CEO Sundar Pichai testifies before the House Judiciary Committee at the Rayburn House Office Building on December 11, 2018 in Washington, DC.

Alex Wong | Getty Images

In ruling Monday that 

This is the hidden content, please

• Sign In
• or
• Sign Up

has held a monopoly in internet search, U.S. judge Amit Mehta invoked the company at the center of the most famous tech antitrust case in U.S. history:

This is the hidden content, please

• Sign In
• or
• Sign Up

.

A federal judge determined in 1999 that

This is the hidden content, please

• Sign In
• or
• Sign Up

had illegally used the market power of its Windows operating system to box out rival browsers, namely Netscape Navigator. A settlement in 2001 forced the software giant to stop disadvantaging competitors in its PC deals.

This is the hidden content, please

• Sign In
• or
• Sign Up

’s landmark case, filed by the government in 2020, alleged that the company has kept its share of the search market by creating strong barriers to entry and a feedback loop that sustained its dominance. The court found that

This is the hidden content, please

• Sign In
• or
• Sign Up

violated Section 2 of the Sherman Act, which outlaws monopolies.

“The end result here is not dissimilar from the

This is the hidden content, please

• Sign In
• or
• Sign Up

court’s conclusion as to the browser market,” Mehta wrote in his 300-page ruling. “Just as the agreements in that case help[ed] keep usage of Navigator below the critical level necessary for Navigator or any other rival to pose a real threat to

This is the hidden content, please

• Sign In
• or
• Sign Up

’s monopoly,

This is the hidden content, please

• Sign In
• or
• Sign Up

’s distribution agreements have constrained the query volumes of its rivals, thereby inoculating

This is the hidden content, please

• Sign In
• or
• Sign Up

against any genuine competitive threat.”

Mehta said one key similarity is the “power of the default.” For

This is the hidden content, please

• Sign In
• or
• Sign Up

, that refers to its search position on Apple’s iPhone and Samsung devices — deals that cost the company billions of dollars a year in payouts.

“Users are free to navigate to

This is the hidden content, please

• Sign In
• or
• Sign Up

’s rivals through non-default search access points, but they rarely do,” Mehta wrote.

Mehta said a separate trial will take place on Sept. 4, to determine the remedies, or penalties against

This is the hidden content, please

• Sign In
• or
• Sign Up

. At that point,

This is the hidden content, please

• Sign In
• or
• Sign Up

can appeal, a process that experts said could take around two years.

This is the hidden content, please

• Sign In
• or
• Sign Up

appealed its initial ruling before ultimately settling with the Department of Justice.

“All along, the government has implicitly and explicitly said they’re basing this case on the

This is the hidden content, please

• Sign In
• or
• Sign Up

case,” said Sam Weinstein, law professor at Cardozo Law School and a former DOJ antitrust lawyer.

In the case of

This is the hidden content, please

• Sign In
• or
• Sign Up

, Judge Thomas Penfield Jackson found that the company forced PC makers to include its Internet Explorer browser in Windows, and threatened to punish them for installing or promoting Navigator. The judge proposed that

This is the hidden content, please

• Sign In
• or
• Sign Up

divest either its operating system business or its applications business, which both enjoyed market leadership. 

After

This is the hidden content, please

• Sign In
• or
• Sign Up

’s successful appeal, a U.S. District Court

This is the hidden content, please

• Sign In
• or
• Sign Up

the software company from retaliating against device makers for shipping PCs that include multiple operating systems.

This is the hidden content, please

• Sign In
• or
• Sign Up

was required to give software and hardware companies the same programming interfaces that

This is the hidden content, please

• Sign In
• or
• Sign Up

middleware employs to work with Windows.

Nicholas Economides, an economics professor at New York University’s Stern School of Business, said the similarities in the

This is the hidden content, please

• Sign In
• or
• Sign Up

case are clear.

“My first reaction on this is that

This is the hidden content, please

• Sign In
• or
• Sign Up

appears to lose across the board,” Economides said. “This big ***** reminded me of the Justice Department’s win against

This is the hidden content, please

• Sign In
• or
• Sign Up

.”

Risk to core search

The most likely outcome, according to some legal experts, is that the court will ask

This is the hidden content, please

• Sign In
• or
• Sign Up

to do away with certain exclusive agreements. The court could suggest that

This is the hidden content, please

• Sign In
• or
• Sign Up

make it easier for users to try other search engines. 

While a monetary penalty is also on the table, the ******* risk is that

This is the hidden content, please

• Sign In
• or
• Sign Up

will have to alter its business practices in a way that undermines profitability. For example, if

This is the hidden content, please

• Sign In
• or
• Sign Up

can no longer be considered a default search engine on smartphones, it could lose a significant chunk of business in its core market.

In the second quarter, “

This is the hidden content, please

• Sign In
• or
• Sign Up

Search & Other” accounted for $48.5 billion in revenue, or 57% of Alphabet’s total revenue.

In its appeal,

This is the hidden content, please

• Sign In
• or
• Sign Up

will likely introduce fresh evidence that artificial intelligence has played more of a role in competition, a dynamic that didn’t exist when the DOJ filed its initial lawsuit. However, it’s a perception

This is the hidden content, please

• Sign In
• or
• Sign Up

has tried to downplay since being upstaged by OpenAI’s ChatGPT.

Neil Chilson, former chief technologist for the Federal Trade Commission and currently head of AI policy at the Abundance Institute, sees increased competition for

This is the hidden content, please

• Sign In
• or
• Sign Up

due in part to AI, which could help the company’s case.

“The rigid market definitions means the court finds that

This is the hidden content, please

• Sign In
• or
• Sign Up

has illegally maintained a monopoly in general search,” Chilson said. But “search vertical providers” like

This is the hidden content, please

• Sign In
• or
• Sign Up

and AI services like ChatGPT “threaten to upend

This is the hidden content, please

• Sign In
• or
• Sign Up

’s entire general search advertising business model,” Chilson said.

This is the hidden content, please

• Sign In
• or
• Sign Up

shares didn’t move much after Monday’s ruling, as the stock was already trading lower due to the broad market sell-off. The stock slipped another 0.6% on Tuesday to close at $158.29.

This is the hidden content, please

• Sign In
• or
• Sign Up

didn’t provide a comment for this story.

Since Mehta didn’t discuss potential remedies in the ruling, investors and analysts are forced to wait. Experts say it’s unlikely that

This is the hidden content, please

• Sign In
• or
• Sign Up

will be forced to break itself up.

“I think there were obvious business lines you could spin off in the

This is the hidden content, please

• Sign In
• or
• Sign Up

case but it’s not as obvious here,” Weinstein said, adding that divestiture is rarely ordered for a Section 2 case.

The trial beginning Sept. 4 will produce some important answers. Bill Baer, who formerly ran antitrust divisions at both the FTC and DOJ, said the

This is the hidden content, please

• Sign In
• or
• Sign Up

precedent makes the case against

This is the hidden content, please

• Sign In
• or
• Sign Up

a strong one.

“It’s hard to say at this point what the DOJ is going to seek and what the judge is going to accept,” Baer said.

— CNBC’s Jordan Novet contributed to this report.

Don’t miss these insights from CNBC PROdata:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///ywAAAAAAQABAAACAUwAOw==

This is the hidden content, please

• Sign In
• or
• Sign Up

#Googles #antitrust #ruling #bears #resemblance #

This is the hidden content, please

• Sign In
• or
• Sign Up

#monopoly #case

This is the hidden content, please

• Sign In
• or
• Sign Up

This is the hidden content, please

• Sign In
• or
• Sign Up

For verified travel tips and real support, visit: https://hopzone.eu/