The government is seeking to show that Alphabet’s Google broke antitrust law to maintain its dominance in online search. (File)
| Photo Credit: REUTERS

The US Justice Department on Monday objected to removing the public from the court during some discussions of how Google prices online advertising, one of the issues at the heart of the antitrust trial under way in Washington.

The government is seeking to show that Alphabet’s Google broke antitrust law to maintain its dominance in online search. The search dominance led to fast-increasing advertising revenues that made Google a $1 trillion company.

David Dahlquist, speaking for the government, pointed to a document that was redacted that had a short back and forth about Google’s pricing for search advertising.

Dahlquist then argued to Judge Amit Mehta, who will decide the case, that information like the tidbit in the document should not be redacted. “This satisfies public interest because it’s at the core of the DOJ case against Google,” he said.

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Speaking for Google, John Schmidtlein urged that all discussions of pricing be in a closed session, which means the public and reporters must leave the courtroom.

It is not unusual in merger trials for information like market share and business and pricing strategies to be redacted.

And sometimes the redactions are broader since, essentially, the companies want the information hidden and the government lawyers fighting the merger are working flat out to win rather than worrying about over-sealing, said Katherine Van Dyck, an experienced litigator and senior legal counsel at the American Economic Liberties Project.

“Litigation is a pretty grueling process,” she said.

Her organisation has pushed for the trial to be put onto telephone lines, as pre-trial hearings were because of the COVID-19 pandemic. Judge Mehta denied that motion.

Van Dyck believes that Mehta’s call was the wrong one.

“When you have these cases with massive, broad public interest and public import, the courts need to do a better job of taking that into account, change their rules and keep up with modern technology,” she said.

Case in point was testimony given early Monday by a Verizon executive, Brian Higgins, about the company’s decision to always pre-install Google’s Chrome browser with Google search on its mobile phones.

After about 30 minutes of testimony, Higgins’ testimony was closed for the next two hours.

It’s possible that he was asked about Google’s payments to Verizon but the public will never know. Those payments – which the government said are $10 billion annually to mobile carriers and others – helped the California-based tech giant win powerful default positions on smartphones and elsewhere.

Throughout the trial, Google’s defense is that its high market share reflects the quality of its product rather than any illegal actions to build monopolies in some aspects of its business.

The antitrust fight could change the future of the internet, now dominated by four giants that have been under scrutiny from Congress and antitrust enforcers since the Trump administration. Companies have defended themselves by emphasising that their services are free, as in the case of Google, or inexpensive, as in the case of Amazon.com.

If Google is found to have broken the law, Judge Mehta, who is deciding the case, will then consider how best to resolve it. He may decide simply to order Google to stop practices he has found to be illegal or he may order Google to sell assets.

Washington:

The US government on Tuesday accused Google of paying out $10 billion a year to Apple and other firms in order to safeguard its monopoly over online search.

The accusation came on the opening day of a landmark trial that is the biggest antitrust case in the United States in more than two decades.

“This case is about the future of the internet and whether Google will ever face meaningful competition in search,” said Justice Department lawyer Kenneth Dintzer as the United States government began making its case against the tech titan.

Over 10-weeks and with dozens of witnesses called to the bar, Google will try to persuade Judge Amit P. Mehta that the case brought by the Department of Justice is without merit.

“Google has for decades innovated and improved its search engine, plaintiffs escape this inescapable truth,” Google’s lawyer John Schmidtlein argued before the court.

Held in a Washington courtroom, the trial is the first time US prosecutors have tackled a big tech company head-on since Microsoft was targeted more than two decades ago over the dominance of its Windows operating system.

“Even for Washington DC, I think we have the highest concentration of blue suits in any location here today,” Mehta joked, observing the dozens of lawyers packed into his courtroom.

The Google case centers on the government’s contention that the tech titan unfairly gained its domination of online search by forging exclusivity contracts with device makers, mobile operators and other companies that left rivals no chance to compete.

Dintzer told Judge Mehta that Google pays out $10 billion every year to Apple and others to secure its search engine default status on phones and web browsers, thereby burying upstarts before they have a chance to grow.

Over the past decade, this created what the government calls a “feedback loop” in which Google’s dominance grew ever bigger because of its monopolist access to user data that rivals could never match.

“Through this feedback loop, this wheel has been turning for more than 12 years. It always turns to Google’s advantage,” Dintzer said.

That dominance has made Google parent Alphabet one of the world’s richest companies, with search ads generating nearly 60 percent of the company’s revenue, dwarfing income from other activities such as YouTube or Android phones.

“We will track what Google did to maintain its monopoly… It’s not about what it could have done or should have done, it’s about what they did,” Dintzer told the court.

– Court ‘cannot intervene’ –

Google firmly rejected the US case saying that its search engine was successful because of its quality and the huge investments made over the years.

“This court cannot intervene in the market and say ‘Google you are not allowed to compete.’ That is anathema to US antitrust law,” Google’s Schmidtlein said.

Schmidtlein insisted that testimony from executives at Apple and others will demonstrate that Google won the coveted default status on iPhone and browsers “on the merits.”

The biggest alleged victims in the case are rival search engines that have yet to eke out a meaningful market share for search or search ads against Google, like Microsoft’s Bing and DuckDuckGo.

Google remains the world’s go-to search engine, capturing 90 percent of the market in the United States and across the globe, much of which comes through mobile usage on iPhones and phones running on Google-owned Android.

Mehta’s ruling is expected many months after the roughly three months of hearings.

He could dismiss the government’s arguments or order drastic remedial action such as a breakup of Google’s businesses or a revamp of the way it operates.

Whatever the outcome, the ruling will almost certainly be appealed by either side, potentially dragging the case on for years.

Launched in 1998, Washington’s case against Microsoft ended in a settlement in 2001 after an appeal reversed an order that the company be split up.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

The Google case centers on the government’s contention that it illegally forged its domination of online search. (File)
| Photo Credit: REUTERS

Google faces its biggest ever legal challenge in a Washington court on Tuesday, as it fends off accusations from the US government that it acted unlawfully to build its overwhelming dominance of online search.

Over ten weeks of testimony involving more than 100 witnesses, Google will try to persuade a federal judge that the landmark case brought by the Department of Justice is without merit.

The trial is the biggest US antitrust case against a big tech company since the same department took on Microsoft more than two decades ago over the dominance of its Windows operating system.

“Technology has progressed a lot in 20 years so what results from this case will have a strong bearing on how tech platforms operate in the future,” said John Lopatka, from Penn State’s School of Law.

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The Google case centers on the government’s contention that it illegally forged its domination of online search by entering into exclusive contracts with device makers, mobile operators and other companies that left rivals no chance to compete.

Through these payments of billions of dollars every year to Apple, Samsung or carriers like T-Mobile or AT&T, Google secured its search engine default status on phones and web browsers and allegedly guaranteed its success to the detriment of competitors.

“Two decades ago, Google became the darling of Silicon Valley as a scrappy start-up with an innovative way to search the emerging internet,” the Justice Department said in its lawsuit. “That Google is long gone.”

The biggest alleged victims in the case are rival search engines that have yet to scratch out a meaningful market share against Google, like Microsoft’s Bing and DuckDuckGo.

90 percent share 

Google remains the world’s preeminent search engine, capturing 90 percent of the market in the United States and across the globe, much of which comes through mobile usage on iPhones and phones running on Google-owned Android.

In its defense the company contends that its success is due to the unbeatable quality of its search engine that has been judged a cut above the rest since its launch in 1998 by founders Sergei Brin and Larry Page.

“In sum, people don’t use Google because they have to — they use it because they want to,” said Kent Walker, Google president of global affairs in a blog post.

The trial will be presided over and decided by Judge Amit P. Mehta, whose ruling would come many months after the roughly three months of hearings.

The stakes for Google are enormous if Mehta upholds any or all of the US government’s arguments.

Remedial action could involve a break up of Google’s far flung business or an order to revamp the way it operates.

The company has faced major legal action in Europe, where it was fined more than 8.2 billion euros ($8.8 billion) for various antitrust violations, although those decisions are under appeal.

Whatever Mehta ends up deciding, the US case will almost certainly be appealed by either side, potentially dragging the case on for years.

Launched in 1998, Washington’s case against Microsoft ended in a settlement in 2001 after an appeal reversed an order that the company be split up.

The US government launched its case against Google during the Trump administration and the suit carried over in the transition to President Joe Biden.

Biden has also made a point of challenging tech giants, but with little to show for it.

In January, Biden’s Department of Justice launched a separate case against Google involving its advertising business and this could go to trial next year.

The company also faces other lawsuits from US states that accuse it of abusing monopolies in ad tech and for blocking competition in its Google Play app store.

Google and the states said on Tuesday that they had reached an agreement in principle to settle the Google Play case.