The Department of Justice (DOJ) has escalated its efforts to curb Google’s dominance in the search engine market, with proposals that could lead to the breakup of the tech giant.
After successfully proving in court that Google operates an illegal monopoly, the DOJ is now pursuing both structural and behavioral remedies to dismantle the company’s stranglehold on search distribution. These remedies include drastic measures like forcing Google to divest key products, such as Chrome, Android, or the Google Play Store.
Search Distribution and Revenue Sharing Concerns
A central issue the DOJ seeks to address is Google’s use of revenue-sharing deals to secure its search engine as the default option on most smartphones and browsers, including those of partners like Apple and Samsung.
The government argues that these deals are anti-competitive because they lock out smaller competitors, preventing them from accessing premium search distribution points. Consumers are unlikely to switch to alternatives, and partners have little incentive to change while they benefit from these lucrative arrangements.
The DOJ sees undoing Google’s grip on search distribution as a critical starting point to address its unlawful conduct.
To counter these practices, the DOJ is considering placing restrictions on the types of contracts Google can negotiate with phone manufacturers and web browsers. The agency is also exploring broader structural remedies, which could involve breaking up the company to prevent Google from bundling its search engine with other popular products like Chrome and Android. The DOJ believes that without such intervention, Google will continue to use its influence in other areas, such as AI, to maintain its market dominance.
Accumulation of Data Hinders Competitors
Additionally, the DOJ’s proposals extend to Google’s use of data. The government has expressed concerns over how Google accumulates vast amounts of user query data, creating a feedback loop that further solidifies its position in the search market. Competitors are at a disadvantage, as they lack access to the same volume of data, making it harder for them to improve their own search engines.
The DOJ is contemplating measures that would require Google to share its data indexes, AI models, and ranking signals with rivals to level the playing field. However, the DOJ acknowledges privacy concerns and aims to ensure that genuine privacy issues are distinguished from arguments designed to protect Google’s market position.
Google has criticized these proposals as excessive, claiming they extend beyond the specific legal issues in the case. The company argues that breaking up services like Chrome or Android would harm consumers by depriving them of widely used, free products. Google also maintains that the government’s approach would have far-reaching, unintended consequences, affecting numerous industries and undermining American innovation.
AI-Driven Search
The DOJ’s proposals also address emerging areas of competition, such as AI-powered search tools. While AI is not yet a replacement for traditional search engines, the government is keen to prevent Google from using its dominance in the search market to unfairly control the future of AI-driven search technologies.
A related concern involves how Google gathers data from websites to train its AI models. The DOJ is considering new rules that would allow websites to opt out of having their data used for AI purposes without losing their inclusion in Google’s search index.
Monopoly in Search Advertising
Advertising is another focus of the DOJ’s crackdown. Judge Amit Mehta, who ruled that Google holds monopoly power in search text ads, noted that Google sets its ad prices without considering competition, which is behavior typical of a monopolist. The DOJ is evaluating remedies that would foster more competition in this space, potentially by requiring Google to license its ad feed separately from its search engine and provide advertisers with more transparency about ad performance.
Support for the DOJ’s approach has come from some of Google’s long-time critics, such as Yelp, which has advocated for the separation of Google’s services to prevent the company from unfairly promoting its own products in local search results. However, the ultimate outcome of these proposals remains uncertain as the legal battle continues, and how far the DOJ will go to limit Google’s power is still to be determined.
Featured Image courtesy of Jakub Porzycki/NurPhoto via Getty Images
Follow us for more updates about DOJ’s crackdown on Google’s search dominance.