Last Friday, October 27, U.S. District Judge Amit Mehta overruled an objection by Google’s trial counsel to a question about how much the online search and ad giant pays Apple and other browser providers for making Google’s search engine the default. The lawyer claimed that making the dollar amount public would hurt Google’s negotiating position in future talks on how much it would pay browser providers to rig their browsers to use Google search by default.
The civil antitrust case began on October 20, 2020 when the U.S. Department of Justice’s Antitrust Division and 38 states brought it in the U.S. District Court for the District of Columbia District. The enforcers allege that Google has unlawfully maintained monopolies in markets for general search services, search advertising, and general search text advertising. They seek “structural relief” plus any other “relief necessary and appropriate necessary to restore competitive conditions in the markets affected by Google’s unlawful conduct”.
The trial to Judge Mehta, who will decide the outcome without the help of a jury, started on September 12. I have followed it off and on and mostly have looked for signs the Court favors one side or the other.
Early indication didn’t look good for the enforcers. In ruling on motions to prevent public airing of certain pieces of evidence, Judge Mehta seemed to defer to claims by big tech companies–Google, Apple, and Microsoft, to name three–that disclosing information to the public would cause them “competitive harm”. He also often closed the courtroom for long stretches so he could hear apparently crucial testimony. At times he appeared testy about media pressure for a public feed, and he lavished many hours on making fine distinctions about the sensitivity of particular facts and evidence. All that struck me as erring on the side of giving the big tech companies’ interests in secrecy more weight and attention than they deserved.
The outcome of the case will have immense effects on the public, I thought. Can’t the Court see that people want and need to know the facts?! Keeping evidence secret will erode trust and reduce confidence in the outcome, especially if it favors Google!
So I welcomed Judge Mehta’s ruling last Friday.
In rejecting secrecy, Judge Mehta allowed the public to know that Google paid $26.3 billion for one year of building bias into Safari and other browsers. How do you explain that to the public? Sure, people can still switch search engines, but we now have evidence that the ease of keeping the Google search engine plus the hassle of changing to one of the many alternatives (e.g., Bing, Yahoo!, or DuckDuckGo) had a value of at least $26.3 billion to Google in 2021.
Did paying $26.3 billion to bias browsers in favor of Google’s search engine amount to unlawful maintenance of Google’s monopoly (90 percent) position? It did if it “foreclose[d] competition in a substantial share of the line of commerce affected.” Tampa Electric Co. v. Nashville Coal Co., 365 U.S. 320, 327 (1961).*
Google contends that biasing browsers didn’t prevent “effective competition” by other search engines. Its success in proving its competitive benignity theory will depend on whether it can convince Judge Mehta that it would have legitimately held onto its monopoly even if it hadn’t paid the $26.3 billion.
Judge Mehta comes from a defense-side background. He favors the status quo. He will therefore need unusually strong reasons to kick Google out of its monopoly position.
But the public now knows he has $26.3 billion worth of them. Will that be enough?
*Believe it or not, the U.S. Supreme Court has not rendered a decision on the merits of a Section 2 monopolization case in the 62 years since it handed down Tampa Electric.