On August 5, 2024, the U.S. Court for the District of Columbia (DC) ruled that Google is a monopolist, meaning it has durable market power as the dominant player in the field of “general search services.” This is a violation of competition law.
As a remedy, the DC court could demand Google search neutrality, which would require it to make its search results transparent. But this decision is unlikely to be a harbinger of a strongly regulated Federal Search Commission, or even a better search experience.
The fine will have no impact on Google, or its peers Apple or Amazon — each of which are facing major cases of their own.
When a company is as rich as Croesus and can hire every competition law firm in the world to appeal decisions, this will not worry the boardroom.
They will worry that they will be forced to operate their systems alongside those of smaller, more innovative and cyber-secure competitors.
When consumers will be able to send messages from their iPhones to any platform, not just iMessage as you can via email or text message, it will scare Apple into complying.
The US Justice Department is seeking interoperability as a remedy in the case against Google, and hopefully for Apple and Amazon as well. It’s not a magic bullet, but it’s the most competitive positioning available other than breaking up these vertically integrated platforms.
In the 1990s, American legal scholar and activist Lawrence Lessig called for breaking up Microsoft, which is still the most profitable of all tech giants. Instead, US and EU regulators implemented some interoperability, though they muddied the details so that the benefits to consumers were limited, despite imposing record fines.
In 2024, there is little desire to break up these behemoths, but some companies are willing to implement interoperability, which regulators now understand much better than they did in the 1990s.
In the European Union, the Digital Markets Act 2022 imposes interoperability on those platforms from 2023, though it is yet incompletely implemented, and the EU unit responsible for enforcement has had teething troubles.
How did we get here?
In 2008, law professors Oren Bracha and Frank Pasquale criticized the rapidly emerging monopoly on Internet search by Google, a “not-so-evil” Stanford start-up that has become a billion-dollar company.
That year, Barack Obama – the “BlackBerry candidate” addicted to his smartphone – was elected the 44th president of the United States in what became known as the “Facebook election” due to his team’s revolutionary online campaign.
Obama’s technology policy was dominated by a commitment to network neutrality, which he announced at a Googleplex talk in Silicon Valley in late 2007, when he was being mentored by his old colleague from the University of Chicago Law School, Lawrence Lessig.
Lessig was the special master in the Justice Department’s prosecution of the Microsoft software-in-Internet browser competition case. He praised Obama for finally ensuring net neutrality in 2014 against the wishes of the Republican-controlled Congress.
Google supported Obama’s network neutrality policy and failed to adopt the Pasquale policy of search neutrality.
Why did it take so long for the Democrats to deal with Google? They dealt with the global financial crisis immediately after taking office and fixed the global economy at the cost of creating moral hazard by telling Wall Street banks they were too big to fail (proven by letting Bear Stearns fail and watching global markets crash).
By 2015, these banks sponsored Donald Trump’s radical bid for the White House, a campaign that benefited from free coverage from cable news and some Facebook ads run by Cambridge Analytica, which was itself funded by billionaire hedge fund manager Robert Mercer and his daughter Rebecca.
Meanwhile, other big technology companies, including Google, Facebook, Apple and Amazon, were growing from billion-dollar companies to trillion-dollar companies, made possible by their voracious willingness to swallow up smaller competitors such as LinkedIn and Skype (Microsoft), AdSense and Motorola (Google), WhatsApp and Instagram (Facebook).
Obama’s Justice Department and Federal Trade Commission (FTC) approved all of these mergers, while economists claimed the price of the free service was comparable to integrating the advertising-funded platforms.
He also blocked moves towards a new federal privacy law, despite a valiant attempt by American academic Danny Weitzner to achieve a basic legislative standard.
This period of unrestricted unregulated growth created the demonstrably dominant platform environment of unregulated Silicon Valley during the Trump presidency.
Economists describe this type of monoculture as a healthy, prosperous outcome, even if it poses huge risks to cybersecurity.
In the year 2020-21, due to the COVID lockdown, white-collar employees had to stay at home, and they had to work even more intensively on social media and e-commerce platforms.
Even universities became big users and funders of those major platforms.
They are now multi-trillion dollar behemoths, the most valuable commercial enterprises in history, even more valuable by investors than Shell or BHP in the 20th century or the British East India Company in the 19th century.
Eventually, the dominance of Google, Apple, Amazon, and Facebook forced the Justice Department to take action as well.
Joe Biden’s COVID-19-dependent campaign against an increasingly deranged and rebellious Trump led to the appointment of Lina Khan as FTC chair in June 2021.
Khan was academically well known for her student research paper, Amazon’s Antitrust Paradox, in which she explained the dangers of vertical dominance in digital markets, and she left the Google-funded Open Markets Institute thinktank after Google tried to prevent her from investigating and advocating for healthy competitive digital markets.
The FTC began prosecuting the world’s biggest monopolies. Now we’ve got the results.
We have a court decision that states it clearly – Google dominates the digital markets. Its behavior has been abusive. Soon we will have another finding against Apple and then Amazon.
We will also have an election in which LinkedIn CEO, lifelong Democrat Reid Hoffman, has called on Democrats to replace Lina Khan, and Trump is funded by Silicon Valley oligarchs and crypto fraudsters who would also abolish the FTC.
If the Justice Department pressures the judge in the Google case to impose a remedy that makes the rules the same globally, that would be a real consequence for consumers and competition.
Chris Marsden is Professor of Artificial Intelligence, Technology and Law at Monash University and an expert in internet and digital technology law, who has been researching and teaching in this area since 1995.
(Originally published by 360info under Creative Commons)
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
