A Verizon executive kicks off the second week of the Justice Department’s case against Google (GOOGL.O), and the trial will soon get into the weeds of commercial agreements with Android makers like Motorola and Samsung that have helped Google build its dominant search business. The trial, expected to last weeks, will test whether courts can clamp down on large tech companies with broad economic power. It’s also a bellwether for the Biden administration’s more assertive antitrust agenda.
The government’s first witness Wednesday was a former Google employee, whom the Justice Department questioned about billion-dollar deals that the search and advertising giant reached with wireless carriers to be the default on their smartphones. The government is trying to show that these deals harmed competition in the search market and boosted Google’s profits.
Chris Barton, who worked at Google from 2004 to 2011, said he made it a priority for the company to negotiate with phone service providers and device manufacturers for a deal where the firm would make its search engine the default in exchange for a cut of the revenue generated by ads shown on their devices. The Justice Department argues that the deals were designed to give Google’s search engine an advantage over competing services and products and that by the time the contracts expired, the company had built up a 91% share of the mobile market for searches.
Google’s lawyers disputed the government’s allegations. Google attorney Richard Schmidtlein showed data indicating that users who had Google pre-installed on their phones or tablets stuck with it but switched away from Bing or other search engines they found less helpful. He also said that the default deals were not exclusive and didn’t harm competitors in other markets outside of search, including web browsers or wireless providers.
Behavioral science experts called by the Defense Department also testified that people tend to stick with default options like search engines or mapping apps on computers and smartphones if they’re already installed and that it’s easier to change those choices if they’re forced to do so. The trial is being held in US District Judge Amit Mehta’s courtroom in Washington, and the government has the burden of proving its claims to win a multibillion-dollar antitrust settlement with Google.
Mehta is looking closely at the evidence presented in the case but has yet to make any rulings on the merits of the government’s antitrust arguments against Google. The judge has broken into questioning several times to ask for clarity of terms used in the testimony and to offer a little skepticism about the Justice Department’s argument that Google is a monopoly. If he does find that the company has violated antitrust laws, he could award the company fines or force it to sell assets to rivals. Despite the high stakes, the final decision is not expected for months. This is the first trial of many that may be filed against large tech firms in the next few years.
