Judge Rules Google Violated Antitrust Laws, Potential Breakup Looms

A US judge ruled on Monday that Google violated antitrust laws by spending billions to establish an illegal monopoly as the default search engine globally. This decision marks a significant win for federal authorities challenging Big Tech’s dominance.

US District Judge Amit Mehta in Washington, D.C., declared that “Google is a monopolist and has taken steps to sustain its monopoly.” Currently, Google controls about 90 percent of the internet search market and 95 percent of the smartphone search market.

This ruling paves the way for a second trial to determine potential remedies, which could include breaking up Google’s parent company, Alphabet. Such a breakup would significantly alter the landscape of online advertising, a market Google has long dominated.

The decision is seen as a major step for US antitrust enforcement against Big Tech, a sector scrutinized across the political spectrum. US Attorney General Merrick Garland praised the verdict as historic for Americans, asserting that no company is above the law. White House Press Secretary Karine Jean-Pierre echoed this sentiment, framing the ruling as a win for competition and fairness on the internet.

Alphabet announced it would appeal the ruling, arguing that while Google has developed the best search engine, it was unfairly restricted from making it easily accessible to consumers. Following the ruling, Alphabet shares fell by 4.5 percent amid broader tech stock declines due to recession concerns.

In 2023, Google’s advertising revenue accounted for 77 percent of Alphabet’s total sales. The judge highlighted that in 2021 alone, Google paid $26.3 billion to ensure its search engine remained the default on smartphones and browsers. Losing such default settings would significantly impact Google’s revenue, exemplified by the potential loss of the Safari default, which could lead to a substantial decrease in queries and billions in lost revenue.

This is the first major ruling in several cases accusing Big Tech of monopolistic practices. The Trump administration initiated the Google search case, marking the first such case in a generation. Federal antitrust regulators have also sued Meta Platforms, Amazon, and Apple, alleging illegal monopolies.

Senator Amy Klobuchar of Minnesota, chair of the Senate Judiciary Committee’s antitrust subcommittee, emphasized the bipartisan support for antitrust enforcement across two administrations. She hailed the ruling as a significant victory for maintaining competition and labeled Google a rampant monopolist, underscoring the ruling’s importance for the American people.

The broader implications for Google and the tech industry are still unfolding as the legal process continues, with potential appeals to the US Court of Appeals and the US Supreme Court. Forcing Google to divest its search business would sever Alphabet from its largest revenue source, potentially hampering its ability to secure exclusive default agreements.

Evelyn Mitchell-Wolf, a senior analyst at Emarketer, noted that any immediate effects on consumers would be delayed if the case goes through a prolonged legal process.