A U.S. federal judge has ruled in an antitrust lawsuit against Google, finding it guilty of illegally monopolizing the search engine market, reports Bloomberg: This is the first major antitrust case against a tech giant in two decades.
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Washington Judge Amit Mehta said Google’s multibillion-dollar deals with Apple and other companies to make Google the default search engine on smartphones and web browsers effectively blocked competition in the market. Built-in search has allowed Google to become the world’s most used search engine and generate more than $300 billion in annual revenue, mostly from advertising.
Mehta, however, notes that Google does not have a monopoly on the general search advertising market, noting that competitors such as Amazon, Walmart and other major online platforms have begun offering search-related advertising on their own sites.
“Google’s distribution agreements cover a significant portion of the search market and limit competitors’ opportunities,” the judge said in the 286-page ruling. Mehta also noted that Google’s monopoly allowed the company to continually raise its online advertising prices without repercussions.
The market reacted immediately to the situation. After the announcement of the decision, shares of Alphabet, Google’s parent company, fell by 4.5% to $159.13. Shares of Apple, which stands to lose billions of dollars from Google’s payments for setting its search engine as the default on iPhones, fell by 5.8% to $207.14.
The judge plans to hold a separate hearing to determine what action to take against the company. The Justice Department has not yet said what changes it will seek, but options include separating Alphabet’s search business from other products like Android or Chrome. The move would be the largest forced breakup of a U.S. company since the identical breakup of AT&T in 1984.
The US Justice Department has not yet commented on the court’s decision, and Google did not respond to Bloomberg’s request for comment.
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