The Google antitrust verdict looms. Here’s what to look for.
Summary
Federal judge could issue a ruling this summer in government’s landmark case.
WASHINGTON—U.S. District Judge Amit Mehta heard two days of closing arguments last week in the government’s landmark antitrust case against Google. Mehta lobbed skeptical questions toward lawyers for both sides, along the way dropping hints about how he’ll rule when he hands down his long-awaited written decision.
Here’s what we learned during the hearings:
When the judge might decide the Google antitrust case
Mehta could announce his decision in the weeks or months to come, judging by timelines in past big antitrust cases.
When oral arguments wound down on Friday afternoon, Mehta didn’t say which way he was leaning on the central question before him—whether Google exploited its market dominance to unlawfully stomp out competitors.
“The importance and significance of this case is not lost on me, not only for Google but for the public," Mehta said.
Mehta previously heard 10 weeks of testimony from more than 50 witnesses, including Sundar Pichai, chief executive of Google and its parent company, Alphabet.
If he finds Google violated antitrust laws, Mehta would then schedule a “remedies" phase of the trial to determine what, if anything, should be done to bolster competition in the internet search market.
An early skirmish in DOJ’s favor
Before delving into the merits of the case, Mehta must define the markets he’s analyzing. This is a critical part of many antitrust disputes, and an unfavorable ruling on this preliminary issue could doom the government’s case.
The Justice Department, joined by a bipartisan coalition of state attorneys general, has said there’s a huge market for “general search services"—products that pull information from across the internet to answer all kinds of queries. The Justice Department says Google dominates this market, performing about 90 percent of internet searches worldwide, with a handful of rivals such as Microsoft’s Bing and DuckDuckGo lagging way behind.
Google has rejected this market definition, saying it ignores how people use the modern-day internet. Google argues there are many places to search for information and products online, including the social media app TikTok, the retailer Amazon.com, or travel booking sites such as Expedia. In aggregate, these serve as a reasonable substitute for Google’s search engine, Google’s lawyers said.
On Thursday, Mehta signaled he prefers the Justice Department’s view of the consumer-facing market. He said he didn’t see how a combination of varied websites such as Amazon or Expedia can replicate Google.
“Certainly I don’t think the average person would say, yeah, Google and Amazon are the same thing," the judge said.
Google gets credit for innovation
From the moment the Justice Department launched its case in October 2020, Google has said that it competes fairly and that it earned its market dominance because it’s the best search engine. Google’s lawyers frequently point out that the top search query on Bing is “Google."
In a good sign for Google on Thursday, Mehta gave the tech company credit for a record of innovation and investment in search technology. He said he was “struggling" to see how he could conclude that Google has become less innovative over time because of a lack of meaningful competition.
“I don’t think anybody would dispute that search today looks a lot different than it did 10 to 15 years ago and much of that—or some of that—is attributable to Google and its continuing efforts to innovate search," the judge said.
Mehta seemed particularly sympathetic to Google’s argument that its dominance in search can be attributed to savvy early investments in smartphone technology. The trial testimony made clear that Microsoft was caught off guard by Google’s innovations, the judge said.
“That’s not anticompetitive—the fact that Google was smart enough to get on the mobile bandwagon before Microsoft," the judge said.
Judge says Apple deal limits competition
Google has long been the default search engine on Apple’s Safari web browser. In 2022, Alphabet paid Apple a staggering $20 billion to maintain its default status on Apple devices, recently unsealed court documents show.
Microsoft chief executive Satya Nadella testified during the trial that the Google-Apple partnership blocks out meaningful competition. The notion that there is real choice in the search engine market is bogus, Nadella said.
Mehta said he didn’t see how an upstart could entice Apple away from that lucrative partnership.
“I can’t conceive of a world in which some other competitor, particularly a new competitor, could do that if Microsoft couldn’t do it," the judge said Thursday.
Mehta said that in a multibillion-dollar market such as internet search, one would expect lots of companies to enter the space in hopes of taking away Google’s profits. Yet there have been only a few market entrants in the last decade, the judge said, adding: “Doesn’t that tell us all we need to know in terms of barriers of entry?"
Mehta asked Justice Department attorney Kenneth Dintzer what Google should have done to avoid this trial.
“Should they have not competed? Should they have sat on the sidelines? Should they have lowered their rev-share offer?" Mehta asked, referencing the revenue-sharing agreement between Apple and Google.
Dintzer responded that Google should have recognized that it had an enormous market share and loosened its terms, he said.
Write to Jan Wolfe at jan.wolfe@wsj.com and Miles Kruppa at miles.kruppa@wsj.com
