On Tuesday, the US Department of Justice announced it was bringing an antitrust suit against the multinational search-and-everything-else giant, Google.
The legal broadside is the first significant use of US antitrust laws – which date back to the Sherman Act in 1890, the era of monopolistic robber barons – since the department's case against Microsoft in the late 1990s.
The cases are not dissimilar, as the justice department itself, and numerous commentators, noted. The suit, which targets the company’s search and advertising practices, alleges that Google used its position, power and wealth to obtain a “grip on distribution” for its search engine across devices of all sorts, from mobile phones to desktop computers, and then used that controlling position to reap fruitful financial gains off advertising.
Microsoft was sued because it bundled its then new Internet Explorer (IE) web browser into its Windows operating system, which ran on the vast majority of personal computers. It had deals to require third-party PC manufacturers to offer IE as the default browser. IE, offered free with Windows (a free service! Sounds familiar?) quickly supplanted Netscape.
In the Google lawsuit, questionable practices called out by the justice department include the claim that Google prevented users from deleting Google as the main search engine on Google’s Android mobile operating system, which is also the world’s dominant mobile system, on the mobile handsets of more than three-quarters of all mobiles.
Default
Google, the justice department says, also paid a lot of money to Apple to obtain the default search engine spot on Apple's iOS mobile operating system. The two operating systems combined are on 98 per cent of all handsets.
“Google is now the unchallenged gateway to the internet for billions of users worldwide. As a consequence, countless advertisers must pay a toll to Google’s search advertising and general search text advertising monopolies; American consumers are forced to accept Google’s policies, privacy practices, and use of personal data; and new companies with innovative business models cannot emerge from Google’s long shadow,” the suit states.
There’s so much that can be winkled out of that brief excerpt, and so many ironies.
It is nearly impossible to fully escape the multiple pieces of this data-gathering Googleverse
First off is that Google pretty much wrote the book on 21st-century market dominance by recognising in the early 2000s that acquiring personal data from the general population, ideally in the least noticeable ways possible and at scale, was the ticket to unimaginable corporate wealth and power.
Turns out a search engine was an excellent way to glean data about what we do, feel, and want. Once Google realised our “data exhaust” was golden, especially if linked to advertising (and Google bought market-dominating online advertising giant DoubleClick in 2007), it was on the road to becoming what it is now: a secretive, data-ingesting, data-controlling cash cow supplying the lion’s share of income to parent Alphabet’s empire.
Add in more “free” services – mail, word processing, calendars – and you harvest ever more data to feed the maw.
Enterprise space
It’s the 21st-century version of owning the desktop and the enterprise space, as Microsoft did with Windows in the 1990s.
Like Microsoft back then, Google is retorting that consumers have choice. They choose Google because Google is better, the company says. But it is “better” because it is built on the virtually choiceless, privacy-eroding data-gathering system that links search and global advertising. Even if we don’t want to be there, we are pushed to use Google search and other “free” products that also fit into the mass advertising complex, because so many others do. It is nearly impossible to fully escape the multiple pieces of this data-gathering Googleverse.
That choice of the word “innovation” is, I suspect, deliberate, too. A key Microsoft defence back then, since echoed by a new generation of tech firms, is that any restriction to its activities would cramp “innovation”. Here, innovation is what new challengers do. Many argue that Google emerged in a more open tech playing field that followed the Microsoft case. What irony!
But it pales in comparison to an overarching irony. We are here now because the US regulatory system failed over two decades to rein in Google's accretion of terrific power and control. Not the FTC, not the FCC, not the justice department; not, in any meaningful way, the individual states.
The EU has done better, but it too has allowed Google’s acquisitions, many of which should never have happened, especially not DoubleClick.
The worry is that – as with Microsoft – the feds have acted too slowly, taken too long, are using a law made for a long-gone era, and lack meaningful, implementable remedies. In addition, the New York Times reports that the suit involves pre-election political positioning by US president Donald Trump's attorney-general William Barr, and that others in the justice department felt more time was needed to build this critical case.
Well, that would be the irony of ironies – if we ultimately throw out this important legal baby with the bathwater simply because Trump wanted an October pre-election surprise.
