Google Pays ‘Enormous Sums’ to Lock Out Competing Search Engines on Phones: DOJ
The US Department of Justice filed an antitrust suit against Google back in 2020, but the case is still winding its way through preliminary hearings, and Thursday’s was the most significant one yet. According to the government, Google pays “enormous” sums to remain the default search engine on phones. It’s a tentpole of the DOJ’s case: It contends this shuts out the competition because no one changes the default search engine setting.
Government attorney Kenneth Dintzer didn’t specify how much Google pays companies like Samsung and Apple to make its search engine the default, but he did tell the court it was “billions.” In 2020, the New York Times reported that Google was paying Apple as much as $20 billion per year to remain the default on the iPhone. These contracts are key to the DOJ’s case against Google.
Google has always said that competition is just a click away, and indeed, it’s relatively simple to change the default search engine provider on a phone. And anyway, Google says it has maintained deals with the likes of Mozilla since the early 2000s, and it’s unclear why the contracts are only now becoming an antitrust issue.
If the DOJ doesn’t accept that argument, Google has more. The company’s attorney John Schmidtlein told judge Amit Mehta that its accusers misunderstand the search market. According to Google, the government is too focused on smaller search engine rivals like Bing and DuckDuckGo. In reality, Google says, it faces stiff competition from platforms like TikTok, Facebook, and Amazon. These companies don’t offer web search, but people still go there to search for things within the platforms instead of going through Google.
A cadre of state attorneys general is pursuing a parallel case against Google in an effort led by Texas AG Ken Paxton. This case will also appear before Judge Mehta, but there’s a layer of political calculation here. Paxton, who has been under indictment for fraud since 2015, often raises the specter of “liberal Silicon Valley” when he squares off against Big Tech. That does not, however, mean he’s wrong in this specific case. For example, recent filings in the case allege that Google intentionally hides the fact that it still tracks users in Incognito Mode.
Depending on the outcome of the case, Google could be forced to pay fines or sell off assets. The government could even demand that the company be broken up as it did with the Bell System in the early 80s.
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