Last october 20 the United States Department of Justicepromoted a lawsuit against Alphabet (Google) of course abuse of dominant position. The trial that will come after her is seen as the great movement against technology in the country of the stars and stripes after the cases against Microsoft in the 90s, when the company then led by Bill Gates was put before the courts for different reasons, all also related to the use of its ecosystem to promote products: the default imposition of Internet Explorer as a browser, or the link between Office and Windows.
In recent months there has been a lot of talk about how The United States has put the magnifying glass on the monopoly or duopoly that the Big-Tech They have about their main businesses, but although we have seen the leaders of the main GAFA appear before Congress, now is when a play in the judicial plane lands on a consistent basis. In Europe, Google has already received two fines amounting to more than 6,000 million euros for similar situations: its use of Android to further amplify searches with Google, and its practices in the field of advertising.
Google’s position as the global dominator of internet searches is clear, but more than a trial directly that clarifies this monopoly in all the sectors in which the big G has interests, the current demand is more focused, according to official documents that Ars Technica was able to access, for abuse of dominant position when enhancing the presence of your search engine.
The lawsuit is mainly focused on what the company does to achieve dominance and what it achieves with that dominant position once it is on top. And according to the Justice Department complaint, Google actually abused its enormous market power to tip the board in its favor and keep potential rivals out.
In short, at least for now, the focus is not so much on practices for which Google has also been accused as enhancing its purchasing systems against Amazon, or its review system against Yelp on suspicion of altering the search results in your favor, but in how, once you already have that monopoly, you are maintaining it by reducing the entry channels of competition to get your search engine to be the tip of your big business in the monetary field: user data and advertising.
And how does Google achieve this? Well, as we already knew, and now we are confirmed by the investigations that are emerging as a result of the demand, many times paying other companies to place Google.com as the default search engine.
The Apple deal
The agreement they maintain has long been known Apple and Google to make Alphabet search the default in Safari, the iOS browser, a direct entry point for users of these devices and, de facto, closing the circle so that mobile search is synonymous with going through Google, given its ownership of the other great smartphone operating system, Android.
The agreement between Google and Apple was renewed in 2017, although without giving specific figures for payments. All we knew so far was from an investigation in the UK that put on the table the figure that the search engine paid the Cupertino company 1,200 million pounds a year just for the agreement in the British market. Now, an investigation in The New York Times covered by the leaks of the lawsuit, raises that amount to between 9 and 12 billion dollars a year globally.
Image: Luis Miranda | Explica.co
If these figures are true, the huge amount of money would be equivalent to what Apple enters in a quarter in its entire services division, according to its latest results. What does Google achieve with this? Well, directly eliminate decision layers in the millions of users of Apple devices, and in practice, close that huge window so that another competitor can access it.
This kind of monopoly circle might seem silly when we know that Google dominates more than 90% of global searches, but it is the center of the judgment to come: know how Google, after creating a product that works and convinces, uses that position of dominance to stop any possible competition from the ground up.
Everything Amazon, Google, Facebook and Apple have done to be investigated for monopoly
The agreement between Apple and Google has brought various debates in recent years, and this week new information brought to the scene the rumor that Apple could be working on its own search engine, which would be to take for granted the end of this collaboration.
Payment to Mozilla
A good paradox that the current technology market has left us is how Google, the developer of Chrome, has managed to lower Firefox from the browser throne and at the same time pay it – less and less yes, just due to its decreasing market rate – so that your search engine was also the predefined one in your product.
Mozilla has always had this agreement as one of its main sources of financing, and it has not always been with Google. In 2015 and 2016, when Yahoo! paid more than 470 million annually to the foundation so that its search engine was the default one. You don’t have to remember how Yahoo! shortly after.
The slow decline of Mozilla and Firefox
Since then, it has been Google who has undertaken this payment, although with more modest figures. It is known that the search engine for the ‘big G’ has already agreed with Mozilla to maintain its quota, with figures that are rumored to be between 410 and 450 million per year until 2023, and that however will only be done public when the organization issues its accounts at the close of the fiscal year.
Charging other search engines
With Google as the default search engine on iOS and MacOS and Mozilla, the other half of the mobile pie controlled by Android was the one that motivated the sanction of the European Union in 2018 when it understood that Alphabet took advantage of its dominant position with this operating system to also mark its service as predefined.
That, in addition to the fine, ended up resulting in a solution that has even benefited Google itself, and that is that the European Union forced it to present different options to users, and Google, which always knows how to look for something positive even with sanctions like this, auctioned the option for other companies to appear as possible search engines by default in different countries.
For Spain, DuckDuckGO, Info.com, and the French Qwant were the ones that bid the most, and from now on they will appear as an option in addition to Google for users to activate it as a predefined search engine when starting a new terminal. Google has also ensured that this auction system is repeated every 4 months, in order to obtain benefits – the bid figures have not been disclosed – every so often.
Google still dominates search, but DuckDuckGO may be your future rival
From Google, upon learning of the lawsuit, a statement was issued in which it said the following:
“This lawsuit would do nothing to help consumers. Rather, it would artificially benefit lower-quality search alternatives, drive up phone prices, and make it harder for people to get the search services they want to use.”
And that may be the great underlying question, to what extent we use Google because it is the best user response it offers or if it has been its practices that have made its competition not able to gain relevance and therefore improve its product. Perhaps the big question here is what was before and, above all, what solution does the US Justice see?
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The article Google’s dominance based on the checkbook: how it pays other companies to enhance its omnipresence was published in Explica.co.