New Delhi | 06-08-2024, 10:43 AM
- A federal judge ruled that Google holds an illegal monopoly in search and text advertising markets.
- The decision marks a major regulatory milestone, the first anti-monopoly ruling against a tech giant in decades.
- Google plans to appeal the decision, citing recognition of its superior search engine quality.
In a landmark decision, US District Court Judge Amit Mehta has ruled that Google holds an illegal monopoly in the search and text advertising markets. This judgment marks a significant regulatory moment, being the first anti-monopoly ruling against a tech giant in decades.
The case, initiated by the Department of Justice and attorneys general from 38 states and territories in 2020, argued that Google maintained its dominance in the search market through practices that created barriers to entry and fostered a self-sustaining feedback loop. The court concluded that these practices violated Section 2 of the Sherman Act, which prohibits monopolistic actions.
Judge Mehta stated, “Google is a monopolist, and it has acted as one to maintain its monopoly.” The court particularly focused on Google’s exclusive agreements with Android and Apple’s iOS devices, which reinforced its dominant position. The decision identified two key markets: general search services and general search text advertising. It was determined that Google monopolized both markets but noted that general search advertising does not constitute a market, thus excluding it from monopoly control.
Attorney General Merrick Garland praised the ruling as a “historic win for the American people,” emphasizing that no company is above the law. In contrast, Google’s President of Global Affairs, Kent Walker, announced the company’s plans to appeal the decision. Walker argued that the court acknowledged Google’s superior search engine quality but restricted its availability.
Following the ruling, Alphabet, Google’s parent company, saw its shares drop over 4 percent amid a general decline in global stock markets.
This judgment sets a critical precedent in the tech industry, highlighting the regulatory scrutiny tech giants face in their market practices and dominance.
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