All you need to know about the Google antitrust suit 

Tech companies and politics have always had a shaky relationship, mainly because the digital industry has evolved way faster than bureaucracy could ever hope to keep up with.

But this polarizing dynamic had reached a new height when the US Justice Department filed an antitrust lawsuit against Google in October 2020.

Let’s see why this happened and what it means for Google.

An antitrust lawsuit 101

First, we need to cover the basics. What is an antitrust lawsuit?

The first antitrust law, the Sherman Act, was passed back in 1890. It was a comprehensive charter of economic liberties, regulating competition among enterprises. The goal was to make sure a free market can exist.

Here are the main points:

      • It’s illegal to have a contract that restrains trade or commerce options among different states or foreign nations.
      • It’s a felony to attempt or conspire to monopolize against other persons and companies, no matter the industry.

In 1914, Congress passed two additional laws to complement the Sherman Act: the Federal Trade Commission Act and the Clayton Act.

And yes, this is where the Federal Trade Commission (FTC) comes from.

This tackled other anti-competitive practices, like:

      • Offering different prices for different purchasers, with the intent of wiping out competitors
      • Exclusive dealing agreements
      • Tying arrangements
      • Corporation mergers and acquisitions that substantially reduce market competition
      • Unfair or deceptive acts that undermine competitors

These laws aim to provide an equal playing field for similar businesses that operate in the same industry.

They’re also meant to prevent companies from gaining too much power over their competitors and playing it dirty for profit.

Laws such as these are put in place to ensure a balanced free market, where everyone gets their fair chance to succeed. They also aim to keep away:

      • Higher prices with no alternatives for consumers
      • Fixing prices and ignoring supply and demand
      • Unfair wages and low compensation to suppliers
      • Lesser incentives to innovate
      • Companies trying to shape society and consumer habits
      • Companies trying to gain political power

In theory, all this is stellar.

Sadly, many unethical companies managed to slip through the cracks and avoid accountability for deceitful or harmful practices.

While the system is far from perfect, the subject of antitrust laws often makes headlines when it comes to tech companies.

Apple, Facebook, Twitter, they’re all too familiar with antitrust claims.

So why does Google’s recent case stand out?

The Department of Justice vs. Google

On October 20, 2020, the US Department of Justice and eleven state Attorneys General filed a lawsuit against Google. They’re accusing the tech company of abusing its position to maintain an illegal monopoly over search engines and search advertising.

The main points of the lawsuit refer to anti-competitive practices, like:

      • Exclusivity agreements that forbid preinstallation of any competing search engine
      • Tying arrangements that force preinstallation of its search engine in prime locations on mobile devices
      • Tying arrangements that make its search engine undeletable, regardless of consumer preference
      • Long-term agreements with Apple that require Google to be the default search engine on the proprietary Safari browser and other Apple search tools
      • Buying preferential treatment for its search engine on devices, web browsers, and other search access points

The news was met with mixed results.

Some thought the lawsuit was long due.

Privacy and open internet activists also seem to be taking this side. They view Google as the long-time gatekeeper of search engines and online products, barring access to more privacy-friendly apps.

On the other hand, Google claimed this lawsuit wasn’t in the consumers’ interest and urged its employees to stay silent on the matter.

But Google dominates online searches in the US, accounting for about 80% of all search queries.

So, it doesn’t come as a surprise that European regulators have already fined Google a total of €1.49 billion ($1.7 billion) for abusive practices in online advertising in 2019.

Back home, the Silicon Valley giant managed to avoid any significant clashes with Washington. On the contrary, Google even garnered some support.

But while Democrats have stuck mainly to criticizing the scale of big tech’s dominance, the Republican party’s tune changed in 2020, as major tech companies were accused of censoring conservative speech.

And William Barr, President Trump’s Attorney General, is allegedly the one that pushed for the antitrust lawsuit.

Some people are now questioning the lawsuit’s timing, just two weeks away from the presidential elections.

Google strikes back

Users on public forums also discussed the wording of the lawsuit. Whether intentionally or not, the case makes people seem technically illiterate.

Google was also quick to point this out and label the lawsuit as flawed.

The bigger point is that people don’t use Google because they have to, they use it because they choose to. This isn’t the dial-up 1990s, when changing services was slow and difficult, and often required you to buy and install software with a CD-ROM. Today, you can easily download your choice of apps or change your default settings in a matter of seconds—faster than you can walk to another aisle in the grocery store. This lawsuit claims that Americans aren’t sophisticated enough to do this. But we know that’s not true. And you know it too: people downloaded a record 204 billion apps in 2019. Many of the world’s most popular apps aren’t preloaded—think of Spotify, Instagram, Snapchat, Amazon and Facebook.
Kent Walker, Google SVP of Global Affairs

Google’s statement also touched on the company’s marketing plans and the quality of its search engine as opposed to “lower-quality search alternatives.” But these are things you’d expect from a company protecting its business model.

Big tech and the elections

Back in 2018, election meddling made the headlines.

The Cambridge Analytica scandal brought to everyone’s attention the ties between politics and social media.

Cambridge Analytica, a British political consulting firm, sold politicians on psychographic modeling. As a result, voters were targeted on sites like Facebook with particular content that appealed to them.

Facebook’s data-mining practices and Cambridge Analytica not-so-academical psychological research were labeled by many as steppingstones for Donald Trump’s presidency.

Now, four years later, and in the middle of a pandemic, the internet plays a more important part than ever. It’s also the playground for heightened online manipulation and disinformation campaigns. The 2020 election looks like no other.

The end of highly-targeted political ads

In September 2020, Facebook’s security team removed a network of fake accounts that originated in Iran, posting divisive partisan messages about the US election. The company also took down a group called the Committee to Defend the President, which ran misleading ads and presented photoshopped images of Democratic candidates as legitimate.

Twitter hired staff, fortified their systems, and developed new policies to purge out Russian bots and troll accounts.

Google also assured users it had taken measures to avoid meddling.

In January 2020, Google announced that advertisers could only target their political ads based on broad criteria, like sex, age, and postal code. The news came soon after Twitter decided to ban political ads.

Both President Donald Trump’s reelection campaign and Democrat election groups quickly criticized Google for the decision.

Other Republican election groups expressed concern that Google might show more leniency towards Democratic political ads due to perceived bias against right-wing content. Google stands its ground claiming there is no bi-partisan bias.

We know that political campaign strategists on both sides of the aisle have raised concerns about how our changes may alter their targeting strategies. But we believe the balance we have struck (…) is the right one.
Google spokeswoman Charlotte Smith

One of the reasons people claim the antitrust lawsuit is retaliation is that Google’s search engine popularity isn’t new.

In fact, in 2012, the FTC has repeatedly urged the Obama administration to take antitrust action against Google, with no results.

The future of politics online

Big tech companies and politicians will probably continue having a strained relationship.

The broad political support in Washington for Google’s antitrust lawsuit helped set the stage for further trials. Which is something open internet advocates haven’t managed to do before.

And yet, based on the newest reports about the hearing, the Google lawsuit is not quite the ambitious attempt to stretch the boundaries of antitrust law that critics had hoped for.

Instead, the Department of Justice opted for a more limited and traditional antitrust action that many lawyers believe gives them a better chance at winning.

But this antitrust lawsuit might tip the balance, and the 2020 election could be the pivotal turning point as far as regulations are concerned. It’s something we’ll be keeping an eye on.

 

What do you think of this antitrust lawsuit? What sort of regulations do you think would be appropriate for Silicon Valley giants? Let me know in the comments below.

Until next time, stay safe and secure!

Leave a comment

Write a comment

Your email address will not be published. Required fields are marked*