The Google Search Antitrust Case: A High-Sensitivity Bench Trial Judgment by Judge Amit Mehta
It is 0 for 2 in the antitrust trials. United States District judge Amit Mehta ruled on Monday that Google has unlawfully maintained its dominance in search by using anticompetitive deals to keep rivals from gaining traction. And without fear of pressure from competitors, Google has been able to charge whatever it wants for search ads, he said.
His findings show that over the past twenty-six years, the company has grown to a $175 billion annual revenue and accounts for much of its parent company’s profits. GOOGLE WILL APPEAR, AS IT IS AT RISK OF BEING CUT FROM IPHONES AND APPLICATIONS ON THE WEB
Attorney General Garland said the decision was an historic win. Assistant Attorney General Jonathan Kanter said it “paves the path for innovation for generations to come.”
The case before Mehta was based on the increased oversight of the tech industry during Donald Trump’s presidency. The first of many lawsuits against Big Tech companies by the Justice Department went to trial after the President left office.
The opinion in the Google search antitrust case, published Monday, is extremely long. Because this was a bench trial, Judge Amit Mehta was on the hook to make factual findings as well as legal findings. So, there are over a hundred pages of findings of fact and even more of conclusions of law, adding up to a 286-page document replete with footnotes, redactions, and even an illustrative graphic of a search result for “golf-shorts” (which, apparently, came up a lot at trial).
The contracts that make the default search engine on the devices are different from the ones for Apple since they have to do with control of the Play Store.
Apple, Google, and Apple have no choice: What they can do about it, or how they are going to get their money, and why they shouldn’t
“I don’t believe there’s a price in the world that Microsoft could offer us,” Cue said at another point. They gave us Bing for free. They could give us the whole company.”
Google and Apple entered into their present contract in 2016. Around then, Apple rolled out Suggestions, their dealings had gone further back. (Think, for example, when you type something out into Spotlight and Apple suggests a website to you — that’s not the same as Google Search.)
(Of course, Cue’s opinion doesn’t mean Bing is objectively bad. The opinion states that Bing has the same search quality on mobile as it does on desktop.
There is more to it than just Bing being refused the time of day by all of these companies. None of these “Fortune 500 companies” have a real choice in the matter.
According to the opinion, “[i]n return for exclusive and non-exclusive default placements (i.e., user-downloaded Chrome and Safari default bookmarks), Google pays Apple a [redacted] percentage of its net ad revenue, which amounted to $20 billion in 2022.”
This was significant. One analysis estimates that a query loss of 10% to 15% of Safari traffic and 4% to 10% of iPad revenue are due to Apple Suggestions. There is a requirement in the new contract for Apple to not expand beyond what they were doing, so that Apple wouldn’tbleed off traffic.
The terms of the 2016 contract seem to have worked out for both companies. The contract with Apple will end in 2026 when it expires in 2021. Apple “can unilaterally extend the agreement by two years,” and if both parties agree, they can extend the contract even further, all the way out to 2031. Part of the contract obligates both Google and Apple to defend this agreement “in response to regulatory actions” (e.g., DOJ antitrust lawsuits, like this one).
Apple has decided that running a GSE would cost the company $6 billion a year, which is on top of what they already spend on search. Meanwhile, in “late 2020, Google estimated how much it would cost Apple to create and maintain a GSE that could compete with Google.” Apple would have to spend something “in the rough order of” $20 billion in order “to reproduce [Google’s technical] infrastructure dedicated to search.”
First off, United States v. Google draws a distinction between general search engines (GSEs) and specialized vertical providers (SVPs). The heavy use of technical jargon makes your eyes water, but the main idea is pretty simple. A GSE is a search engine in the sense that everyone understands it — Google, Bing, DuckDuckGo, and so on.
There are thousands of small search boxes all over the internet if you’re really crazy about it. Sometimes you even use them in a similar way to Google Search — say, for example, to look for cheap flights to a specific destination or to buy a pair of black flared leggings. Booking.com and Amazon.com are not the same as a general search engine for the World Wide Web. Do you have to logically justify this gut reaction? No. It has been done for you by the court of law and you probably don’t need to read it.
Nevertheless, says Judge Amit Mehta, social media platforms are distinct — they’re walled gardens of content. And more importantly, “there is little evidence that they actually compete with GSEs for search queries.” The TikTok study doesn’t really think about whether the platform’s search quality results are relevant to kids or not, because kids don’t really mean it. And TikTok is not the only social platform. One study, he says, suggests that Facebook use corresponds with an uptick in Google Search use.
For Mehta, when it comes to an antitrust analysis, the internet habits of Zoomers are not relevant information. “Imagine if Google’s search quality substantially degraded, whether purposely or through neglect,” he writes. (Yes, imagine. Who. Could. Imagine. That.) Would it be possible for a social media platform to put out a product that resembles a GSE in order to capture some of the dissatisfied Google users? The answer obviously is no.” It would take “extraordinary cost and expense” for even a juggernaut like Amazon or Meta to fill that hole in the market.
Maybe artificial intelligence is the future but not in a way that is relevant to antitrust law. A judge writes that artificial intelligence may someday “fundamentally alter search” but not anytime soon. Elsewhere, he writes that “[c]urrently, AI cannot replace the fundamental building blocks of search, including web crawling, indexing, and ranking.”
He found that while generative artificial intelligence did reduce the need for user data to deliver quality search results, it didn’t eliminate them completely. The finding of fact quotes Neeva’s co-founder Sridhar Ramaswamy who said that the middle problem of figuring out what are the most relevant pages for a given query in a given context still benefits enormously from query click information. And it’s absolutely not the case that AI models eliminate that need or supplant that need.”
When you search for golf- shorts, you have to keep in mind that the information you get from the results is based on what pages you end. That feedback loop isn’t happening with AI chatbots.
The opinion also quotes Google’s own VP of search, Pandu Nayak, as saying that it’s vitally important for Google to continue to “have an infrastructure that [it] understand[s]” — that is, the traditional ranking system. According to Nayak, “there is no sense in which we have turned over our ranking to these systems. We still exercise a modicum of control over what is happening and an understandability there.”