The US Department of Justice has filed an antitrust lawsuit against Google (NASDAQ:GOOGL), accusing the tech giant of anticompetitive tactics in protecting its monopoly for the search engine and associated ad business. This is the government’s most significant effort challenging Google’s market dominance in the internet sector for almost two decades.
Google accused of anticompetitive policies
According to the lawsuit, the search engine giant has been using anticompetitive practices to put off competition like paying Apple Inc. (NASDAQ:AAPL) to be the main search engine in its devices. The company has deals with several other handset makers and mobile carriers to make their search engine a default option. Its search engine has a dominant market share accounting for almost 80%. Google became the first major tech company to see an antitrust lawsuit since the 90s when the US government fought with Microsoft Corp (NASDAQ:MSFT).
Besides Google, other tech companies such as Facebook Inc. (NASDAQ:FB), Amazon.com Inc. (NASDAQ:AMZN), and Apple are also facing an antitrust probe. At the beginning of the month, House Democrats finalized a yearlong investigation accusing the tech giants of violating anti-trust regulations. The DoJ lawsuit is a huge step that will result in sweeping changes in the industry and have ripple effects that will affect other tech companies. The lawsuit could set a cascade of other suits from State attorney generals with four states already having conducted investigations.
Lawsuit to have ramifications on tech giants
Each tech company has something to lose with the breakup of Search for Google, which is the main revenue generator expected to impact the power of advertising. On the other hand, a company like Facebook will have its apps such as Instagram and Whatsapp broken off while Apple will loosen control over the App Store. Amazon, on the other hand, risks its outside sellers’ marketplace broken off.
US Attorney General William Barr has been speaking publicly about the probe for months and had urged the agency to file a suit at the end of September. However, there was some resistance from agency lawyers who said that the suit is politically motivated.