Any change in how we interact with the internet resulting from this decision is likely to be far off, if it even comes at all. The court has not ordered any sanctions or imposed any injunctive relief yet and the Justice Department has not indicated what relief it will seek based on the August 5, 2024 opinion. The court analyzed what it deemed “exclusive agreements,” essentially the various internet service agreements Google has in place. It found that “general search services” is the relevant product market and that Google in fact has monopoly power in that market. The court also found that “search advertising” – advertising served in response to a query – is a relevant market, but that the government did not prove that Google possesses monopoly power in that market. However, the court found that Google has monopoly power in the “general search text ads” market, essentially ads that have the appearance of organic search results that provide links to an advertiser’s website.
Although the court found that it was “taken aback by the lengths to which Google goes to avoid creating a paper trail for regulators and litigants”, it chose not to impose sanctions on Google. It found that the government’s request for sanctions does “not move needle” on its assessment of liability.
There will undoubtedly be appeals of the decision. Sherman Act §2 cases are frequently fought over the contours of what constitutes the relevant markets and both sides are pouring over the court’s delineation of the relevant search and advertising markets, so it is of course possible that some or all of the court’s findings will be overturned. Recall that the order to breakup Microsoft in 2000 was overturned on appeal and ultimately that case was settled.
Assuming the court’s decision stands, however, the Department of Justice now faces the task of navigating what remedy it wants to seek. DOJ may ask for the most draconian remedy available, as it did in the Microsoft case (and Standard Oil two generations ago), namely breakup of Google. There may be tactical benefits for requesting breakup even if DOJ does not think that the court will grant that drastic a remedy. But there may be a political downside to such a request given how ingrained Google is in all of our online lives. The public may balk at a proposed breakup that threatens the ease of online searches, especially to a public that seems more than willing to give up privacy concerns for the ease of finding the nearest taco restaurant or proving your uncle wrong at Thanksgiving.
Another option would be to force Google to spin off the Chrome browser or the Android operating system. That may well be as difficult to obtain as a complete breakup of the company. More likely would be some form of prohibition on actions that allow Google to be the default search option, such as payments to equipment manufacturers for that default position. This is precisely what the European Union has done, requiring Android manufacturers to offer their users the option to choose a search engine when the first start using the smartphone. So far, the EU’s efforts to curtail Google have had no noticeable effect, however.
There does not seem to be an obvious, simple injunction that would effectively reduce Google’s market power. The court could, of course, order that Google stop doing the offending acts, but as the EU has seen, public behavior has become so ingrained that merely preventing Google from taking steps to ensure that its search engine becomes the default option will not likely change market behavior for the foreseeable future. Tactically, DOJ may therefore seek the most draconian measures available, giving it a bargaining position for a possible settlement and consent order that has more teeth.
In the end, AI driven search engines such as SearchGPT, a partnership between OpenAI and Microsoft, may create a more competitive market than currently exists, irrespective of what the court does. Of course, Google is developing its own AI search tool, Search Generative Experience, so it will not sit idly by while competition develops.