The U.S. government’s massive investigation into the country’s largest technology companies is entering its fifth year.
Online search and digital advertising giant Google is the first U.S. technology giant to file an antitrust lawsuit in federal court in decades.
In August 2024, Judge Amit Mehta of the U.S. District Court for the District of Columbia said, “Google is a monopoly and has been defending its monopoly.” The judge was referring to the company’s actions related to its online search business. behavior.
Late Tuesday, the Justice Department issued recommendations on Google’s search engine business practices, suggesting it is considering a possible breakup of the company, although less dramatic remedies are more likely.
letterGoogle’s parent company plans to appeal the ruling. The company did not respond to CNBC’s request for comment.
According to Judge Mehta’s August opinion, Google controls about 88% of the online general search market. The Justice Department’s initial complaint, filed in October 2020, said building a legal alternative to Google Search would cost billions of dollars to build and millions more each year to maintain. Alternative web search engines, e.g. Microsoft’s Despite years of efforts, Bing or the privacy-focused DuckDuckGo have failed to make meaningful headway on Alphabet-owned Google.
“Throughout the trial, we heard a lot of people talk about how Google search has gotten so bad over the past decade,” said Lee Hepner, senior counsel at the American Economic Freedom Project, which filed a filing. Amicus briefs challenging Google’s activities in its app store and other properties.
Google is back in court this fall, facing accusations of unfair practices in the ad tech market. In late 2023, a jury returned a guilty verdict against Google in a trial regarding business practices related to the Google Play app store. The original challenge was launched in 2020 by Epic Games.
Following the Epic ruling, a US judge issued a permanent injunction on Monday forcing Google to provide an alternative to Google Play for downloading apps on Android phones
“For the sake of future innovation, and ultimately for the sake of American democracy, they should keep them separate,” said Nicholas Gugenberg, an assistant professor at the University of Houston Law Center.
While the prospect of a Google breakup is far-fetched, some on Wall Street believe the move could unlock value for shareholders as the company competes for market share in emerging technologies like cloud computing and generating artificial intelligence.
“I think the sum of the parts can really unlock value,” Gene Munster, managing partner at Deepwater Asset Management, told CNBC in August.
watch video Let’s take a look at why the US government wants to investigate Google.
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