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Key Takeaways
- Google violated antitrust laws by maintaining an illegal monopoly in search, a federal judge ruled Monday.
- Judge Amit Mehta ruled in favor of the Department of Justice (DOJ), saying that Google held “general search services and general text advertising” monopolies through its “exclusive distribution agreements.”
- Google has agreements to be the default search option in browsers like Apple’s Safari.
- The ruling could benefit competitors like Microsoft’s Bing or OpenAI’s new SearchGPT.
- The decision marks a major win for the DOJ as the U.S. government attempts to rein in big tech companies over breaches of antitrust rules.
Alphabet’s (GOOGL) Google broke antitrust law, a U.S. federal judge ruled Monday, saying that Google Search held an illegal monopoly.
Judge Amit Mehta ruled in favor of the Department of Justice (DOJ) in a suit first filed in 2020, finding that Google violated the Sherman Act by “maintaining its monopoly in two product markets in the United States—general search services and general text advertising—through its exclusive distribution agreements.”
Through distribution agreements, Google Search is the default search engine in browsers like Apple’s (AAPL) Safari.
What Does the Ruling Mean for Google and Search Competitors?
The judge’s decision finds Google guilty of violating antitrust law, but has not yet determined punitive action.
The U.S. government could decide to take action to curb Google’s influence over the search market or break up the business, which may benefit Google Search competitors like Microsoft’s (MSFT) Bing or OpenAI’s recently announced SearchGPT.
Decision Marks Win for DOJ in Big Tech Antitrust Cases
The decision marks a major win for the DOJ as the U.S. government attempts to rein in big tech companies over breaches of antitrust rules.
The news comes amid reports that Nvidia (NVDA) is facing DOJ antitrust investigations and the Federal Trade Commission (FTC) is investigating Microsoft for potential violations as well.
Apple is also under DOJ investigation for possibly breaking antitrust laws with a smartphone market monopoly.
Shares of Google parent Alphabet fell 4.5% to $159.25 Monday after the judge’s ruling amid a global sell-off, though even with Monday’s losses, shares have gained 14% since the start of the year.