Key Takeaways
- Alphabet said it plans to file an appeal after a judge ruled it violated antitrust laws to maintain a monopoly with Google Search.
- Google has distribution agreements with companies like Apple to make Google Search users’ default search engine.
- The appeal, if successful, could be a good sign for other big tech companies that may face similar antitrust cases.
- If the appeal fails, the U.S. government will determine how to remedy Google Search’s monopoly, which could include changing the distribution agreements.
After a federal judge ruled that Alphabet’s (GOOGL) Google broke antitrust law by holding a monopoly with Google Search, Google said it plans to appeal the decision, which could have implications for big tech antitrust cases to come.
Google responded to the ruling saying the “decision recognizes that Google offers the best search engine, but concludes that we shouldn’t be allowed to make it easily available.”
The judge ruled that Google’s exclusive distribution agreements are problematic.
Google has agreements with browser makers, major original equipment manufacturers (OEMs) for Android devices, and U.S. wireless carriers, paying “traffic acquisition costs (TAC)” to companies like Apple (AAPL) to make Google Search users’ default, the lawsuit outlined.
What’s Next as Google Plans Appeal
The outcome, which could set a precedent for big tech antitrust action, may not be realized for months or even years.
If successful, the appeal would allow Google to maintain its distribution agreements and could ease worries about other big tech companies that could be subject to similar antitrust cases.
If courts reject Google’s appeal, the U.S. government will determine a remedy for the company’s violation of antitrust law, which could range from fines, forcing changes to Google’s agreements, or other measures to break up the company’s monopoly over the search market.
These efforts could benefit competitors like Microsoft’s (MSFT) Bing or OpenAI’s recently announced SearchGPT, and affect companies involved in the distribution agreements like Apple.
Alphabet shares were little changed Tuesday. They’ve gained over 13% since the start of the year.