Google’s Opening Arguments Fail to Exonerate Its Coercive Multi-Billion Dollar Default Agreements

September 12, 2023 Press Release

Washington, D.C. — In response to opening arguments in U.S. v. Google this morning — frequently referred to as the most important antitrust trial of the century — the American Economic Liberties Project, a leading antitrust advocacy organization, released the following statement.

“After opening arguments today, one thing is abundantly clear: Google has a near untouchable monopoly over the search market thanks to its multi-billion dollar default agreements,” said Lee Hepner, who was in the courtroom today and is Counsel at the American Economic Liberties Project. “The Department of Justice’s opening arguments revealed that Google’s dominance over search not only ‘hermetically seals off competition,’ but also allows it to flex its power to influence how other companies, like Apple and Samsung, market and develop their own products. Google is attempting to stretch the limits of the law to claim that it helps or encourages competition, which is simply untrue. We look forward to watching the Department of Justice’s (DOJ) robust case unfold, which we expect will prove without a doubt that Google’s default search agreements are fundamentally anticompetitive.”

The lead attorney for the DOJ, Kenneth Dentzer, laid out a comprehensive case for how they’ll prove Google’s default search agreements constitute clear anticompetitive conduct, surmising in their remarks that, “evidence will show that it is unquestionable that Google has enormous monopoly power.” As the government explained, Google has had its monopoly over search since 2010, and has used that power to create a walled garden that blocks nascent competitors and extort exorbitantly high rents for advertising space. Using Google’s agreements with Apple and Samsung as examples, the DOJ revealed how the giant’s power is so great that it is even able to dictate the way other companies develop their products — threatening to cut revenue sharing for companies that don’t abide. Given data that Google lost significant search share when Mozilla changed its default search, it’s clear that Google would not have built its empire without default agreements.

Following the DOJ’s coherent and logical case, Google’s opening arguments mainly consisted of an obfuscation and misrepresentation of the facts. Google is trying to stretch the limits of the Sherman Act to claim that its default contracts improve competition in markets outside of general search engines, namely for web browsers and cellphones. Google also misled the public by claiming it’s easy for people to switch their default search engine. They know, as everyone else does, that it’s simply not and that’s why so few people do it. And when asked by Judge Mehta for data supporting this, Google, a company with seemingly infinite resources, had nothing to provide.

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The American Economic Liberties Project works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. Economic Liberties believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.