Following over a year of investigation, the Department of Justice has filed an antitrust lawsuit against Google, asserting that the company “unlawfully maintains monopolies in the markets for general search services, search advertising, and general search text advertising in the United States.”

The complete legal document is available here. The suit references Section 2 of the Sherman Act – the portion of the law addressing monopolies – and aims to both “restrain” Google and secure remedies for the impact of its actions. These remedies could include financial penalties, required divestitures, or alterations to its business operations, or a combination of these measures.

Joining the DoJ in this action are 11 states, all led by Republican attorneys general: Texas, Arkansas, Florida, Georgia, Indiana, Kentucky, Louisiana, Mississippi*, Missouri, Montana, and South Carolina.

This case represents the most substantial governmental challenge to a major technology company in decades. The last instance of such intense scrutiny involved Microsoft, with an investigation beginning in 1992, a lawsuit filed in 1997, and a final settlement taking effect in 2001. Some believe the government’s actions against Microsoft fundamentally altered the tech landscape, creating opportunities for Google and similar companies to grow.

Now, Google finds itself facing similar allegations:

“Google serves as the primary access point to the internet and is a dominant force in search advertising,” stated Jeffrey A. Rosen, deputy attorney general. “Google achieved initial success through legitimate means, and that is acknowledged. However, as detailed in the antitrust complaint, it has sustained its monopolistic power through exclusionary practices that hinder competition. Therefore, the Justice Department has concluded that antitrust intervention is necessary to benefit consumers. Without enforcement of antitrust laws to foster competition, future innovation could be stifled, potentially preventing the emergence of the ‘next Google.’” He also indicated that the DoJ intends to continue examining potentially anti-competitive behaviors by leading online platforms.

Google’s leading positions in search and search advertising are central to its extensive portfolio of advertising, data analysis, video distribution, and information services.

This lawsuit marks the first significant legal challenge Google has encountered from U.S. regulators, despite numerous prior investigations into its business practices.

A previous attempt in 2012 to bring a case against the company regarding anti-competitive conduct was abandoned due to concerns about the strength of the legal arguments. Since then, Alphabet, Google’s parent company, has experienced substantial growth, with its value exceeding $1 trillion based on current stock prices.

Alphabet maintains a strong lead in both search and video. The company controls the vast majority of the search market – approximately 90% of all internet searches globally are conducted on its platform – and around three-quarters of American adults utilize YouTube for video content, as reported by The Wall Street Journal.

Google responded to the DoJ suit with the following statement:

“Today’s lawsuit brought forth by the Department of Justice is seriously flawed,” the company asserted. “Individuals choose to use Google because it is their preference – not due to coercion or a lack of viable alternatives.”

The Department of Justice alleges that Google, through its Alphabet subsidiary, employs a network of restrictive business agreements to exclude competitors. The substantial revenue Google generates is used to compensate mobile phone companies, carriers, and browser developers to establish Google as the default search engine. This practice limits competitors’ ability to gain the necessary queries and traffic to improve their own search capabilities.

According to Justice Department officials cited by the Journal, the government’s case will focus on these agreements, as well as Google’s practice of pre-installing its search engine (and preventing its removal) on devices running the Android operating system, and prohibiting the pre-installation of competing search engines.

Leaders of companies negatively impacted by Google’s business tactics – viewed by some as aggressive competition and by others as unlawful coercion from a powerful corporation – are already sharing their perspectives.

“We are encouraged by the DOJ’s action in holding Google accountable for obstructing competition, locking users into its products, and achieving a dominant market position to the point where they avoid public discussion about it,” stated Gabriel Weinberg, CEO of rival search engine DuckDuckGo, on Twitter.

https://twitter.com/yegg/status/1318551326234730502

Yelp!, a company that has actively lobbied in Washington D.C. to highlight how Google’s products operate within a closed, self-promoting ecosystem, also commented on the DOJ’s lawsuit.

“By systematically diminishing the quality of its search results to reinforce and expand its search and search advertising monopolies, Google is directly harming consumers,” Yelp wrote in a statement. “Yelp commends the work of the DOJ and urges swift action by state attorneys general who are conducting parallel investigations into other facets of Google’s business.”

This antitrust suit follows a series of other regulatory actions involving Google, which is not only the leading online search provider but also a major player in online advertising, mobile technology through Android, and a variety of other interconnected services including mapping, productivity software, and cloud computing.

Bipartisan Effort Unfolding in Stages

A report published last Friday by Politico indicated that Democratic state attorneys general would not be participating in the lawsuit, which aligns with today’s announcement. The suit has been filed solely by a coalition of Republican attorneys general representing 11 states, alongside the Department of Justice.

The report also highlighted that these attorneys general have been developing a collaborative, state-led strategy addressing a broader range of concerns than just search. The rationale behind this approach is that multiple lawsuits could potentially strengthen the government’s negotiating position with the technology company.

Later that same day, New York Attorney General Letitia James, along with the attorneys general from Colorado, Iowa, Nebraska, North Carolina, Tennessee, and Utah, released a statement following the Department of Justice’s announcement, confirming their intention to work together.

“For the past year, both the U.S. Department of Justice and state attorneys general have been conducting independent yet coordinated investigations into Google’s anti-competitive practices. We value the strong bipartisan collaboration among the states and the positive working relationship with the Department of Justice regarding these significant matters,” the statement explained. “This represents a pivotal moment for both federal and state antitrust authorities as we strive to safeguard competition and foster innovation within our technology markets. We anticipate finalizing portions of our investigation into Google in the coming weeks. Should we decide to pursue legal action, we would seek to consolidate our case with the Department of Justice’s. We would then jointly litigate the consolidated case, similar to our approach in the Microsoft case.”

“We maintain open communication with them and have greatly appreciated the collaboration we’ve experienced, along with the cooperative relationship with all states involved in the investigation,” stated Rosen today. “Some states have chosen to join this complaint, while others are pursuing their own course of action, but this does not reflect a lack of support for the underlying concerns.”

A separate lawsuit is currently being prepared by the state of Texas, although it has encountered some challenges.

Numerous major technology companies are currently under increased examination by Washington regulators. However, with the U.S. election just two weeks away, significant progress in this case, and others, is unlikely before then. Furthermore, should a change in administration occur, a substantial shift in personnel at the Department of Justice could also alter the direction and timeline of this Google lawsuit.

Regardless, legal battles involving regulatory challenges are typically lengthy and complex. In Europe, Google has been subject to a series of fines for antitrust violations over several years, including a $2.7 billion penalty concerning Google Shopping; a $5 billion fine related to Android’s market dominance; and a $1.7 billion fine regarding search ad brokering. While Google continues to pursue appeals, additional cases against the company are ongoing in Europe and other regions.

Google is not the sole focus of Washington’s attention. Earlier in October, the House Judiciary Committee published a comprehensive report exceeding 400 pages, detailing how tech giants Apple, Amazon, Alphabet (Google’s parent company), and Facebook are leveraging their market power. The report covered areas of dominance and proposed potential solutions, including restrictions on their acquisition strategies.

This report primarily served to document the current situation and could potentially inform future actions. However, unlike the Department of Justice lawsuit, the House report does not carry the authority for enforcement or remedies.

Updated throughout with additional details.

*A previous version of this article incorrectly stated that the Attorney General from Michigan was joining the Department of Justice’s lawsuit. It is the Attorney General from Mississippi who is joining other Republican prosecutors in the case.