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Unpacking Google's Antitrust Case
The biggest tech monopoly trial since the Department of Justice challenged Microsoft more than 20 years ago
So even as Monopoly Capitalism is at its worse with the worst possible abuses happening in Generative A.I.’s centralization around the same few companies, we rarely even hear about antitrust regulation in the U.S. media or Silicon Valley’s own tech news cycle. It’s convenient.
On Substack we are citizen journalists, we aren’t constrained over what we are or aren’t allowed to cover. There’s nobody lobbying us, owning us or controlling us.
After years of supposed cases being built, The US government finally coming after the Google’s Ad business. The Cloud-Ad-AI Cartels sometimes referred to as BigTech, are only getting stronger.
So the first big trial of the modern Big Tech antitrust movement is here and began actually yesterday: On September 12, the Department of Justice’s lawsuit against Google’s search engine monopoly began. That’s not to say that the powerful lobbyists didn’t already win. About a month before the case started, a US district court judge dismissed several of the claims that the Department of Justice and a coalition of states brought against the company, including allegations that Google Search harms competing services. Very odd.
The biggest tech monopoly trial since the Department of Justice challenged Microsoft more than 20 years ago
Guilt of favoring your own products is nearly meaningless today in BigTech’s pariah culture. But don’t expect American rule of law to make free market capitalism healthy again, it’s a different era now.
“If the DOJ loses, it becomes a very serious question of what’s it going to take,” Harold Feld, senior vice president at Public Knowledge, an open internet advocacy group, said. “Other than an act of Congress, is there any way that a court is going to apply the antitrust laws to these new business models and new technologies?”
The trial is expected to last 10 weeks and will feature testimony from Google boss Sundar Pichai as well as executives from Apple.
Judge Amit Mehta, who was appointed to his position on DC district court by former president Barack Obama, will decide the case - the biggest for the industry in 25 years.
The BigTech cartel can afford powerful lawyers, lobbyists and influence politicians in any number of ways. A very probable case of corruption in the U.S. legal system and the hope of there being real fair play in Silicon Valley is today pretty laughable.
At stake in this trial is the chance for the DOJ to prove it can bring a successful anti-monopoly case in the modern digital age, and for Google to preserve a long-standing business practice for its search products.
The DOJ, FTC and SEC have never felt so small and meaningless in the U.S. God won’t save American from monopoly Capitalism the likes of Google, Meta, Microsoft, Amazon and Apple’s power.
Google, which has been synonymous with internet search for decades of course used antitrust strategies to create a moat that was unassailable, making the internet what it is today. A broken advertising based funnel for your data.
The American Dystopian Ads Prism Legacy Internet
A lawyer for the federal government argued that Google has illegally protected its internet search monopoly using deals struck with smartphone makers.
Google pays off its cartel for a piece of the profits.
The Justice Department has accused Alphabet's Google of paying $10 billion annually to device makers like Apple , wireless companies like AT&T, and browser makers like Mozilla to keep its search engine's market share at around 90%. It’s not actually a secret how the internet works.
Rule of Law Doesn’t Actually Apply to BigTech
Google’s list of offenses is long in the EU, where rule of law is still maintained and practised with due diligence. Not so much in the U.S.
Since 2017, when the European Commission fined Google a then-record $2.73 billion for self-preferencing with its comparison shopping service, the company has faced a steady drumbeat of regulators accusing it of antitrust violations.
In 2018, EU antitrust regulators fined Google $4.3 billion for requiring smartphone makers to bundle and include the company’s apps with Android.
In 2019, the EU fined Google $1.49 billion for making unfair demands of publishers that sought to use its AdSense for Search service.
With Alphabet’s Gemini coming soon and Meta’s AI Personas ready to dominate the chatbot and LLM industry, antitrust has become a bit of a joke. Still…
Big tech companies and regulators are closely watching the trial, which could force a shift in how the industry is allowed to operate. Its outcome could reshape how the public accesses and interacts with the internet, or embolden Google to pursue an even tighter grip on the market.
By the Numbers
Google, which in just 25 years has grown into a $1.7 trillion company that owns major swathes of what we do online. It was all built on that search engine, which remains Google’s biggest revenue generator even now. Search ads were nearly 60 percent of the company’s revenue in 2022, to the tune of $162.45 billion.
Ugh, late-stage Capitalism isn’t just disrupting democracy, it’s hurt the media industry, free speech and human privacy, and likely hurt social and economic inequality all the while. American have been dumbed down for quite a few decades that has led to this event. Young people don’t have much of a future in this system of Capitalism, which is as far from a meritocracy as it ever was in recent memory.
The US said Google typically pays more than $10bn a year for that privilege, securing its access to a steady gush of user data that helped maintain its hold on the market. Apple pays a similar amount to be in China, and yet U.S. sanctions on A.I. chips are is rocking the boat.
It turns out BigTech works more like a drug cartel than an ecosystem for humanity. Of course what are Ads, feeds and algorithms really doing to us?
But by 2005, worried about its lead eroding, Google proposed to pay the company - later threatening to cancel payments if other firms got similar access, the government said. Eric Schmidt who is leading an A.I. Supremacy war of the U.S. against China, was CEO of Google from 2001 to 2011 and the company's executive chairman from 2011 to 2015.
U.S. dominance over China, really means the U.S. Tech Cartel can keep their power.
I’m not a historian but I plan to learn about BigTech history from this trial all that I can. Google it turns out also discouraged Apple from expanding its own search products and Samsung, which makes Android phones, from working with a company that used a different kind of search method. All of this corporate politics sounds pretty illegal.
With millions of pages of documents produced and depositions from more than 150 people, the case has finally gone to trial.
“This case is about the future of the internet and whether Google’s search engine will ever face meaningful competition,” said Kenneth Dintzer, the Justice Department’s lead litigator.
Dintzer argued the trial would show that Google maintained a monopoly over search for the past decade through exclusionary deals with device makers that cut out competitors. He also alluded to Google’s attempts to block access to documents and auto-delete internal messaging to stymie antitrust enforcement.
The BigTech Cartel have figured out how working together, they can beat the system, until they are the system. That’s nothing new in human history. The problem is when this level of corruption takes place it usually means a decline of an Empire. Democracy is also fairly less healthy since the internet has gone so unregulated in the U.S.
The crimes of Google, Meta and the Ad-players is actually pretty steep for human civilization. It might take some time for this to be revealed.
Google said it faced intense competition, not just from general search engine firms, such as Microsoft's Bing, but more specialised sites and apps that people use to find restaurants, airline flights and more. In fact, Google has taken even more marketshare from Bing, even as Microsoft pretended was an AI leader with its partnership with OpenAI.
Alphabet’s Gemini and PaLM tech will be formidable in the end, and will be able to stifle rivals even better with Generative A.I. nativity, talent, R&D and a multitude of products only someone like Google could ever accomplish. Gemini at this pace, won’t get regulated until maybe 2042. Gemini is set to launch later this Fall of 2023.
If we can’t even agree that Google has favored its own products illegally like Search or Ads, then we have a serious problem in maintaining rule of law as an internet species. The Cartel will escallate what they are able to do to us.
Previous major antitrust trials include Microsoft, filed in 1998, and AT&T, filed in 1974. The AT&T breakup in 1982 is credited with paving the way for the modern cell phone industry, while the fight with Microsoft is credited with opening space for Google and others on the internet.
It’s not clear what Google would actually have to do if it lost this specific case.
The justice department filed its suit in 2020, but later joined in an additional suit against Google brought by attorneys general from more than three dozen states and territories. The states’ case will also be heard during the trial, with the antitrust lawyer William Cavanaugh acting as lead attorney for that lawsuit.
Google has repeatedly tried to present its search as just one part of a broader network of services such as TikTok and Amazon that people use to search for information or products. That Google favors its own products in its search is fairly obvious to anyone who has ever used the search engine, used Chrome or noticed how much of their data is being siphoned.
Back in the day, Internet Explorer was bundled with Microsoft’s Windows operating system, and Microsoft ensured it was just about impossible to remove. Microsoft hasn’t actually changed much as it tries to force me to use Bing AI or Edge in any way that it can on this sad state of Windows.
Google has engaged in a course of anticompetitive and exclusionary conduct that consisted of neutralizing or eliminating ad tech competitors through acquisitions; wielding its dominance across digital advertising markets to force more publishers and advertisers to use its products; and thwarting the ability to use competing products. In doing so, Google cemented its dominance in tools relied on by website publishers and online advertisers, as well as the digital advertising exchange that runs ad auctions.
It’s no secret. But Monopoly Capitalism has been so normalized, even on the stock market only about 10 companies really matter things have become so centralized.
Judge Amit Mehta, an Obama appointee from 2014, is presiding over the case and will decide on a ruling. There is no jury in the trial. This is what rule of law looks like in the U.S. today.
When Apple first installed Google as the default search engine in 2002, no payments were involved, prosecutors said.
But by 2005, worried about its lead eroding, Google proposed to pay the company - later threatening to cancel payments if other firms got similar access, the government said. Today BigTech bribes everyone including the CCP for access. They call it how business works. They defend each other because they rely on each other, much in the way a drug cartel does.
Top executives at Google and its corporate parent Alphabet Inc., as well as those from other powerful technology companies are expected to testify. Among them is likely to be Alphabet CEO Sundar Pichai, who succeeded Google co-founder Larry Page four years ago. Court documents also suggest that Eddy Cue, a high ranking Apple executive, might be called to the stand.
Google’s anticompetitive conduct has included:
Acquiring Competitors: Engaging in a pattern of acquisitions to obtain control over key digital advertising tools used by website publishers to sell advertising space;
Forcing Adoption of Google’s Tools: Locking in website publishers to its newly-acquired tools by restricting its unique, must-have advertiser demand to its ad exchange, and in turn, conditioning effective real-time access to its ad exchange on the use of its publisher ad server;
Distorting Auction Competition: Limiting real-time bidding on publisher inventory to its ad exchange, and impeding rival ad exchanges’ ability to compete on the same terms as Google’s ad exchange; and
Auction Manipulation: Manipulating auction mechanics across several of its products to insulate Google from competition, deprive rivals of scale, and halt the rise of rival technologies.
Google isn’t just an Ads machine, it’s a Monopoly Capitalism bottleneck holding us back from so much new innovation. The same Meta has done, the same Amazon is doing, and so forth down the line. Now Apple, Microsoft, Netflix and others are racing to become more powerful in digital advertising. The Cartel is growing. And the conduct and affiliations of these entities is becoming stale and corrupt, and a dystopia of Silicon Valley’s decline is emerging for anybody looking for the signs.
The government has asked for "structural relief" if it wins - which could mean the break-up of the company. Can you imagine Google Cloud or YouTube as their own companies? I cannot.
Microsoft bundles products even worse. Amazon and TikTok are growing into Advertising that will eat Meta’s lunch. But it’s hard to eat Google’s lunch, and that’s the point. Are LLMs real innovation or just new tools for Silicon Valley to maintain control? Generative A.I. might be a gigantic head-fake, and people are buying into it.
The company is also facing a federal lawsuit over its advertising business and has found itself in the crosshairs in Europe, where it has been fined billions in monopoly cases. Up until now and since Microsoft in the 90s, antitrust regulation in American has been pretty dysfunctional and the health of Capitalism has deteriorate significantly. Young people no longer really believe in it, including algorithmic democracy, where social media Ads help win campaigns.
This is the world Silicon Valley optimism 30 years ago has built, this is what the world has to inherit. It’s not U.S. leadership, it’s American corruption. It’s cartels in the forms of technology.
History shows us that justice is rarely served in such cases. Think about it, Mehta will probably take months before ultimately making a decision in the case, with a ruling expected early next year. It is unclear what punitive measures Google would face if found guilty of violating antitrust law. The case has drawn comparisons to the justice department’s 1998 antitrust suit against Microsoft, which resulted in a marquee trial that ended with a judge ordering Microsoft be broken up into separate companies. That order was later overturned, with the government and Microsoft later agreeing to a watered-down settlement.
America is a corrupt state, and pretending otherwise is sort of foolhardy and naive at this point. The Justice Department filed its antitrust lawsuit against Google nearly three years ago during the Trump administration, alleging that the company has used its internet search dominance to gain an unfair advantage against competitors. By the time this is all finished, Donald Trump might be president again. Since 2020, the BigTech cartel has gotten a lot stronger.
The end of Silicon Valley has resulted in a winner-takes-all scenario. And Generative A.I. and AGI could be the beginning of a dark age of dystopia.