So the judge says that because things changed in the search space (AI / GPT searching) that changes the advertising space (which the GPTs don’t really do much of – yet) which is what the case was about. The anti-competitive facts of the case were before GPTs came along and are not relevant to the current GPTs but all of that somehow doesn’t matter so Google doesn’t really have to change much.
Champagne will be flowing at Google HQ after US District Judge Amit Mehta decided to do very little to rein in the monopolistic web giant.
In his 230-page ruling Mehta, who last August ruled that Google broke US competition law, decided the search behemoth will not have to divest its Chrome browser or Android operating systems, and can continue to pay billions to the likes of Apple to secure a prominent place for its search engine.
“Google will not be required to divest Chrome; nor will the court include a contingent divestiture of the Android operating system in the final judgment,” he ruled. “Plaintiffs overreached in seeking forced divestiture of these key assets, which Google did not use to effect any illegal restraints.”
That decision will disappoint the US Department of Justice, because Mehta rejected the remedies it called for.
The only government proposal Mehta accepted was that Google must share access to user-side data, albeit only to “qualified competitors.” While this includes things like a search index and user-interaction data, it doesn’t have to hand over specific advertising data.
“If you think of ingredients as data, like users’ search index, recipes are what they do with that data and how they use that data to make search results more relevant,” Adam Kovacevich, CEO of technology non-profit Chamber of Progress and a former Googler, told The Register.
“What you had is Google’s rivals arguing that Google had to share its recipes’ secret sauce. And the judge rejected that. He said: ‘You only have to share their ingredient list, effectively their search and search index.'”
The ruling also includes a requirement for Google to stop entering into exclusive deals that make the search giant the default search engine on mobile devices. It also requires Google to submit to six years of regulatory oversight by a technical committee that will monitor it to ensure it’s not backsliding.
You don’t find someone guilty of robbing a bank and then sentence him to writing a thank you note for the loot
The DoJ is likely to appeal but had no comment at the time of publication. However, the ruling has infuriated antitrust groups.
“You don’t find someone guilty of robbing a bank and then sentence him to writing a thank you note for the loot,” said Nidhi Hegde, executive director of the non-profit American Economic Liberties Project.
“Similarly, you don’t find Google liable for monopolization and then write a remedy that lets it protect its monopoly. This feckless remedy to the most storied case of monopolization of the past quarter century is a complete failure of his duty and must be appealed.”
Yet another thing AI has ruined
So what was it that caused the judge – who said barely a year ago that the ad slinger was an “overbearing illegal monopoly” – to do so little to change the status quo?
Mehta found that AI has changed the competitive landscape Google faces since the DoJ first brought its case in October 2020.
“The emergence of GenAI changed the course of this case,” he wrote. “No witness at the liability trial testified that GenAI products posed a near-term threat to general search engines (GSE).
“The very first witness at the remedies hearing, by contrast, placed GenAI front and center as a nascent competitive threat. These remedies proceedings thus have been as much about promoting competition among GSEs as ensuring that Google’s dominance in search does not carry over into the GenAI space.”
Mehta argued that over the past year he has sought out multiple sources of testimony to discuss AI and the issues that surround it, and is therefore cognizant of the issues it creates. But the original case was about Google’s existing advertising practices. The judge claims he addressed that matter.
Google clearly agrees with Mehta when it comes to AI changing the antitrust situation. In a statement, it welcomed the ruling and said it will continue to dispute his initial finding that it is an illegal monopoly.
“Today’s decision recognizes how much the industry has changed through the advent of AI, which is giving people so many more ways to find information,” Google said in a canned statement. “This underlines what we’ve been saying since this case was filed in 2020: Competition is intense and people can easily choose the services they want.”
Google and Mehta do have a point. The Chamber of Progress’s Kovacevich – who attended many of the hearings – pointed out that when the case was heard generative AI was very new, and the AI search market was still in its infancy. In the nearly five years since, much has changed.
“Anybody who has been paying attention to technology in the last two years would say that generative AI does pose a competitive challenge to traditional search engines,” he opined.
Anybody who has been paying attention to technology in the last two years would say that generative AI does pose a competitive challenge to traditional search engines
“So I think what the judge was grappling with was this reality that it changes the game, and it changed the game since Google was found liable in the first phase of the trial. So I thought it was great that he was acknowledging that, and spent so many pages [of the ruling] just talking about how much that poses a competitive challenge to traditional search engines.”
And the billions will keep flowing
Google’s stock price shot up by eight percent in after-hours trading and Apple’s jumped 2.5 percent, suggesting investors like this ruling.
That sentiment may stem from the fact that during the trial it emerged that in 2021 Google paid more than $26 billion to other companies to make sure that it was the default search engine on their platforms. Apple raked in $18-20 billion in 2020 alone, around a quarter of its profit in that year [PDF]. Google wouldn’t spend that sort of money unless it paid off, so its shareholders may be pleased that a big source of revenue remains viable.
Mozilla is another beneficiary of Google’s largesse. While the amount it gets is trivial in comparison to Cook & Co, thought to be around $400 million, the foundation has very few other sources of revenue. Earlier this year Mozilla’s CFO warned that cutting the Google subsidy would “potentially start a downward spiral of usage as people defected from our browser, which … could at the end of the day put Firefox out of business,” the judge notes.
At the time of publication, Apple and Mozilla had no comment.
Mehta noted that the loss of such payments would be “crippling,” and “downstream harms to distribution partners, related markets, and consumers, which counsels against a broad payment ban.”
So what will change for consumers? In effect, almost nothing. Google will carry on as before, and the case will drag on for years.
“Users will be in much the same position as before,” Mitch Stoltz, litigation director for the EFF told The Register.
“The lack of any restructuring of Google, or even a ban on the massive revenue sharing payments to Apple and others for default search placement that were at the heart of the government’s case, mean that Google’s incentives won’t change, and the data-sharing remedies may be undermined.” ®
Source: Judge who ruled Google is a monopoly orders modest remedies • The Register
Robin Edgar
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