In a major blow to Google, a U.S. federal district judge ruled on August 5 that Google was engaging in illegal practices that stifled competition in the online search market. The ruling mirrors an historic 2001 antitrust case against Microsoft, and could have major ramifications for the company and the industry, according to experts.
Specifically, the ruling could lead to major changes in how Google operates and potentially impact its substantial ad revenue, which totaled $146 billion in 2021.
Analyst Evelyn Mitchell-Wolf from eMarketer noted that enforcing changes could significantly affect Google’s financial stability, potentially even more so if exclusive deals with companies such as Apple and Mozilla are banned.
Google’s dominant position in the market, which has allowed it to gather extensive user data and refine its services more effectively than its competitors, will also be impacted. The ruling will take away Google’s overwhelming market share, which has grown from 80% in 2009 to 90% in 2020, with a 95% share in smartphone search.
Rebecca Haw Allensworth, a professor at Vanderbilt University, called the judge’s decision “the most significant antitrust decision of the century” and suggested it might be the first of many actions against major tech companies.
The U.S. Department of Justice may expand its focus. An investigation into Apple is already underway for allegedly making it difficult for iPhone users to switch to other brands. This scrutiny is part of a broader effort to tackle perceived abuses of market power among major tech companies.
The Google case is seen as a major step in ongoing regulatory actions against Big Tech, with potential implications for how other tech giants, including Apple and Meta, might be held accountable for their market practices.