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A precedent on antitrust action

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Aug 07, 2024 09:15 PM IST

US court ruling labels Google a monopolist, marking a pivotal moment in pushback against tech giants’ dominance. The verdict may set a precedent for future cases worldwide.

This week’s US federal court ruling that Google acted illegally to maintain its online search monopoly marks a pivotal moment in the global pushback against the dominance of tech giants. The judge’s scathing order, labelling Google a monopolist, paves the way for potential remedies to address this market control. The ruling was in a government lawsuit, which highlighted Google’s staggering annual expenditure — $26 billion in 2021 alone — to secure default search engine status on mobile phones and web browsers. This strategy effectively marginalised competitors while bolstering Google’s position and, in turn, its advertising revenues. The company’s defence, claiming superior service as the root of its popularity, failed to convince the court.

Google, U.S. flag and Judge gavel are seen in this illustration taken, August 6, 2024. REUTERS/Dado Ruvic/Illustration (REUTERS)
Google, U.S. flag and Judge gavel are seen in this illustration taken, August 6, 2024. REUTERS/Dado Ruvic/Illustration (REUTERS)

Undeniably, Google Search has been instrumental in ushering in today’s information age, with its verb status a testament to its success. However, like other tech behemoths, Google allegedly maintained its monopoly through careful corporate decisions, striking at the heart of free-market principles. The US justice department has sued other major tech companies. Amazon faces accusations of stifling marketplace sellers, Apple of creating “a moat around its smartphone ecosystem”, and Meta of acquiring potential competitors to eliminate threats. These companies now wield unparalleled influence across all facets of life — from business to culture.

The Google ruling may set a precedent for how other cases against the other tech giants unfold. What the federal court orders, as the jurisdiction where Google is physically located, will be of significant consequence globally. But, most importantly, it serves as a stark indictment of Big Tech’s practices. They have been the vanguard of technological progress, having created truly remarkable products and services that transformed the world. But they also used those early successes as a springboard to create an anti-competitive environment that makes it difficult for tomorrow’s Google, Apple, Amazon or Meta to emerge.

The global regulatory landscape has become increasingly aware of this, with the EU leading the charge by fining Big Tech billions of euros. Other nations, India included, are now mulling over stricter fair-play laws. This awakening was long overdue. Moving forward, regulators must rely on a simple barometer for the market: Is it free and fair? The challenge lies in crafting regulations that foster innovation and combat monopolies, especially for tech, where the rate of evolution is often orders of magnitudes higher than it is in conventional industry.

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