A judge rules that Google’s a monopoly in a massive antitrust L for Big Tech

Do not pass go… On Monday, a US federal judge ruled that Google broke the law to become a search monopoly. It’s the first anti-monopoly ruling against a Big Tech company in decades, and it’s a major loss for Google. Judge Amit Mehta didn’t mince his words, saying: “Google is a monopolist, and it has acted as one to maintain its monopoly.” The decision came as a result of a US Justice Department lawsuit filed against Google in 2020. Google plans to appeal.

• Monopolies are illegal in the US under the Sherman Act, and the court found that Google made illegal anticompetitive moves to sustain its search dominance.

• Just Google it: The company controls roughly 90% of the digital search market and has a 95% share of the market on smartphones.

The result could be a huge blow… to Google parent Alphabet. The worst-case scenario would be a forced divestiture of its search biz, which last quarter accounted for nearly 60% of its total revenue (search raked in nearly $43B). But one antitrust expert told Sherwood it’s unlikely that Alphabet will have to break up with search. What’s more likely: Google will be ordered to stop paying to be the default search engine on browsers.

• Google has exclusive agreements with Apple and Android manufacturers like Samsung to be the default search on their default browsers.

• Billions on the line: Court documents showed that in 2022 Google paid Apple $20B to be the default in Safari. In 2021, Google paid companies over $26B to be the default.

• In 2020, Google estimated it could lose up to 80% of its iPhone and iPad search volume if it gave up its Apple default, which could result in ~$33B in lost revenue.