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Summary
- An antitrust lawsuit is expected to be lodged against the global tech giant Google for deliberately engineering its search engine to place its rivals at a disadvantage
- DOJ had filed a similar case against Google in October for misusing its market dominance and technology expertise to crush competition.
- A fine of $10 billion was slapped on Google by the EU for misusing its market position.
Google seems to be in a spot of bother as a coalition of US states are expected to file an antitrust lawsuit against the global tech giant. According to media reports, Google has been accused of deliberately engineering its search engine to place its rivals at a disadvantage in the digital marketing arena. The antitrust lawsuit is expected to be filed on Thursday.
This is not for the first time that Google is facing such an issue. In October, the US Department of Justice (DOJ) filed a lawsuit against Google and accused it of misusing its market dominance and technology expertise to crush the competition and lead the market share in the search engine advertising domain. California and other 11 states have agreed to the lawsuit filed by the DOJ.
Also read: Google services’ global outage: Here’s what exactly happened?
Notably, the lawsuit will be a bit different from the earlier on filed against Google in October. The antitrust lawsuit is expected to be filed in the Washington DC federal court with a purpose of consolidation with the DOJ lawsuit filed in October.
It is a known fact that Google is the most preferred choice for people to search anything and everything. The online advertising domain is the most lucrative mode for companies to push their products, and Google dominates the arena.
The EU had ultimately fined Google with nearly $10 billion for malpractices to abuse its dominant position on the market after it pursued the company on antitrust charges for nearly a decade. Notably, Google controls more than 90 per cent of the market share of the search engine market across Europe. Despite being penalised, not much has changed in Europe. However, the US is a different territory.
Another reason for Google’s dominance in the market is that very little competition has emerged in the last two decades. However, the digital marketplace has transformed rapidly in the last two decades. Moreover, Google charges a fee from its competitors to appear on selected platforms. The competition controlling power rests with Google.
To counter the dominance, the UK is all set to get a new tech watchdog next year, which is expected to safeguard the interests of consumers and small businesses and might act as a whistle-blower for malpractices in the digital marketplace.
In order to oversee a new code of practice on digital platforms, the Digital Markets Unit, which is an integral part of the Competition and Markets Authority, has been set up to manage digital platforms. According to CMA, US tech giants, such as Google and Facebook, dominated the market as they had a major share in digital advertising revenues in 2019. CMA was first to introduce the idea of setting up a separate pro-competition regulatory regime for online platforms in July. The DMU would be operational from April 2021.
Alphabet Inc (NASDAQ:GOOGL) shares have plummeted by more than 3 per cent in a week’s time. On Tuesday, 15 December 2020, shares closed at USD 1,761.08.
