Washington, D.C. — “The entire notion that people have choice is complete bogus,” said Microsoft CEO Satya Nadella during his testimony today in the landmark antitrust trial brought on by the Department of Justice and 38 states and territories against Google’s search monopoly.

Nadella’s testimony shed light on the true extent of Google’s search dominance — as experienced by a peer company — holding no punches as he repeatedly emphasized the cost to competition of Google’s agreements with mobile companies and wireless carriers that make Google’s search the default on most devices.

“It’s not the ‘open web’, it’s the Google web,” said Nadella in front of Judge Mehta. “I’m worried the ‘vicious cycle’ I am locked in will get even more vicious.” 

Microsoft operates Bing, Google’s largest search engine rival, yet Google dominates 90 percent of the market through restrictive default contracts with companies like Apple. Nadella went so far as to say that Apple and Google have a “fantastic oligopolistic arrangement.” Before Nadella became Microsoft’s CEO, he was a top executive overseeing Bing. 

Nadella also revealed that Google “has carrots, and it has a massive stick,” when trying to intimidate phone makers and carriers into making Google the search engine. That stick is withholding the Google Play Store, the most popular app marketplace for phones not created by Apple. “Without Google Play,” as Nadella said, “an Android Phone is a brick.”

“Share and scale is quality,” he said later on. “You need to get to high share in order to have a high-quality product long term.”

Nadella also noted that Google’s predominance in mobile search gives it an advantage in “dynamic data access,” meaning Google can collect and analyze user behavior quickly and respond by immediately modifying its search algorithms. 

Testifying about Microsoft’s struggles competing with Google search, the CEO shared that Bing is waiting for a market intervention or a new innovation to grow their market share. He said Google only exists for two reasons: Google’s default distribution deals and the judgment against Microsoft in the landmark 2001 antitrust case, which Nadella testified at more than 20 years ago. 

He expressed concern about exclusive content deals, and said he worried Google “will lock up content.” Looking to the future, especially with new technologies, Nadella said that the development of AI is when this “vicious cycle gets more vicious.”

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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.