Google is sued by US Department of Justice

category:Finance
 Google is sued by US Department of Justice


Millions of Americans rely on the Internet and Internet platforms in their daily lives, said William Barr, the U.S. attorney general. Competition in this industry is crucial, and thats why todays antitrust violation against Google is a major case for the Justice Department and the American people. I give priority to the Department of justice to review online market leading platforms to ensure that the country remains competitive with the technology industry. The lawsuit is against Googles core business, search and Internet advertising. Because millions of American consumers, advertisers, small businesses and entrepreneurs are affected by illegal monopolists.

Jeffrey Rosen, Deputy Minister of Justiceuff08 JeffreyA.Rosen uff09Like the historic antitrust actions taken against at & T in 1974 and Microsoft in 1998, the Justice Department has again applied the Sherman Act to restore the role of competition and open the door to the next wave of innovation in the digital market, he said

As one of the worlds richest companies with a market value of more than $1 trillion, Google has almost monopolized the Internet access of billions of users and advertisers around the world. Over the years, Google has accounted for 90% of all search queries in the United States, and has used anti competitive strategies to maintain and expand its monopoly position in the field of search and search advertising.

1. An exclusive agreement forbids the pre installation of any competitive search service.

2. Enter into bundling and other agreements to force its search application to be pre installed in the primary location of the mobile device and make it impossible to delete it, regardless of consumer preferences.

3. A long-term agreement with apple made Google the default (and, in fact, the only) search engine on safari and other apple search tools.

The U.S. Department of justice believes that Googles anticompetitive behavior damages competition and consumers, and reduces the ability of innovative new companies to compete with and constrain Googles behavior. In addition, the US Department of justice has compared Google to standard oil, at & T and Microsoft, saying that its monopoly is the same as those companies that have been sued by the US Department of justice.

The U.S. Department of justices lawsuit against Google is the first at the federal level. Previously, the Attorney General of several States has been investigating Google. In California, where Google is headquartered, Californias attorney general has yet to confirm its findings, but media reports say the state has launched its own investigation separately from the multi state work led by Texas.

Google response

Kent walker, Googles chief legal officer, refuted the U.S. Department of justices lawsuit on his blog after the announcement of the Departments suit.

According to Walker, there are serious flaws in the lawsuits filed by the Department of justice. People use Google because they choose to do so, not because they are forced to choose or because they cannot find alternatives. The lawsuit does not help consumers. On the contrary, it will artificially propose lower quality search alternatives, lead to higher mobile phone prices, and make it harder for people to get the search service they want to use.

Walker also believes that the Departments complaint ignores the point that consumers choose to use Googles search service because they are willing to do so because it is easy to set up a default search engine. He added that consumers use specialized search engines such as Expedia and OpenTable, and even platforms like Twitter to find information outside Googles services.

In order to present its services to consumers, Google pays for the digital shelf space of supermarkets, Walker wrote. But he added that Googles competitors are also easy to get and that its contracts are not uncommon for the industry as a whole.

As for Apples choice to use Google search in its browser, Walker believes that Googles search is the best.. Even Tim Cook, Apples chief executive, praised Googles search service in 2018. Googles arrangement is not exclusive, and competitors are willing to pay to appear in Apples Safari browser, Mr. Walker wrote. He added that users can easily change their default search engine as needed.

Will Google be split?

As early as October 6, the antitrust sub committee of the judicial committee of the house of representatives of the United States released the digital market competition survey.

The report points out that there are monopoly behaviors among apple, Amazon, Facebook and Google (GAFA), which hinders the innovation and development of the industry market and damages the relevant interests of consumers. Among them, Google is accused of giving priority to display its products in search results to crack down on competitors. However, Amazon uses its market advantages as the largest online retailer and leading e-commerce market to block potential competitors; apple is accused of monopolizing the application market of iPhone and iPad, which enables the company to extract excessive commission from the sales of application developers; Facebook is criticized for frequently purchasing competitors or even purchasing competitors in order to maintain and expand its monopoly position To achieve business goals by copying competitor services and other means.

CITIC Securities believes that in the future, strengthening the supervision and M & A audit of technology giants may become increasingly fierce in the world, with Facebook and Google bearing the brunt. Instagram and WhatsApp in the former may be split. Once Googles behavior of bundling its own software on Android system is restricted, it will have a great impact on the companys main advertising business, and Youtube may also be split. In contrast, the charges against apple and Amazon are relatively minor, mainly focusing on the unreasonable charges and discrimination of third-party merchants on the platform, such as the Apple tax of up to 30% and the relatively high ranking of Amazons self operated products.

In addition, the US presidential election will be held in two weeks. The new presidents ruling philosophy may also have an impact on the fate of technology giants.

CITIC Securities believes that if the Democratic Party sweeps the presidency and the Senate and the house of Representatives, the Democratic Partys proposal will not go forward, and the monopoly investigation on the technology giant may be formally implemented in the next years proposal. Next year, the relevant anti-monopoly and regulatory legislation is likely to be passed, which will have a greater negative impact on the technology giants. However, vice president Biden vice presidential candidate Harris, as California senator and former California attorney general, is closely related to Californias technology giants. The majority of the electoral contributions are from the technology giants. After her election, there is possibility of mediation. China Merchants Securities believes that the four major technology giants apple, Amazon, Microsoft and Facebook have made great contributions to the previous rise in US stocks. If radical measures are taken against apple, Amazon, Facebook and Google, the fermentation will have a greater impact on US stocks. On the whole, Bidens policy orientation tends to be more fair among fairness and efficiency. It may cancel Trumps tax cuts on enterprises and increase taxes on the rich, which has already made the market worried about the performance of US stocks, while Biden and the Democratic Party are more likely to promote the split of large technology enterprises. Source: Securities Times editor in charge: Chen Hequn_ NB12679

CITIC Securities believes that if the Democratic Party sweeps the presidency and the Senate and the house of Representatives, the Democratic Partys proposal will not go forward, and the monopoly investigation on the technology giant may be formally implemented in the next years proposal. Next year, the relevant anti-monopoly and regulatory legislation is likely to be passed, which will have a greater negative impact on the technology giants. However, vice president Biden vice presidential candidate Harris, as California senator and former California attorney general, is closely related to Californias technology giants. The majority of the electoral contributions are from the technology giants. After her election, there is possibility of mediation.

China Merchants Securities believes that the four major technology giants apple, Amazon, Microsoft and Facebook have made great contributions to the previous rise in US stocks. If radical measures are taken against apple, Amazon, Facebook and Google, the fermentation will have a greater impact on US stocks. On the whole, Bidens policy orientation tends to be more fair among fairness and efficiency. It may cancel Trumps tax cuts on enterprises and increase taxes on the rich, which has already made the market worried about the performance of US stocks, while Biden and the Democratic Party are more likely to promote the split of large technology enterprises.