The US Department of Justice (DOJ) has issued an ‘initial proposed final judgment’ that suggests a ‘comprehensive remedy’ to break Google’s monopoly in the search business. The proposals include the following: that Google divest its Chrome browser, be prevented from entering into exclusionary agreements with third party smartphone OEMs, and be prevented from pushing its search service along with its other apps. Judge Amit Mehta had already ruled in August that Google’s search business and search text advertising had violated US antitrust law, the Sherman Act, and that it was an ‘unlawfully maintained’ monopoly.

The ‘unlawful monopoly’ of Google is underpinned by prominence of the Chrome browser, and paying billions of dollars to OEMs like Apple and Samsung to retain Google search as the default search engine in their operating systems. Today, Google Search is a monopoly with 90 per cent market share. User data gleaned from these applications enables Google to better its search engine quality, which amounts to reaping unfair advantage of market dominance.

Anti-trust actions against Internet monopolies are not without precedent. Microsoft was in a similar spot a little over two decades ago. In 2000, a Judge had ordered the break-up of Microsoft given its dominance of the PC operating system market, making it challenging for rival applications like the browser Netscape Navigator to be easily integrated into its OS. It finally ended in a settlement where Microsoft was left intact, but ceded ground that included making its Windows OS more interoperable with rivals’ software. An encore cannot be ruled out. Google with its vast financial resources will likely mount a legal challenge to the proposed remedies, and a middle ground could be arrived at over the next year or two. Eliminating the huge payments made to companies like Apple and Samsung to ensure Google search as the default browser could be one of those concessions. Ironically, the rise of Chrome, launched in 2008, is in part due to the positive fallouts of the Microsoft anti-trust case. This only shows that anti-trust rulings are not fetters to business, but legal tools to foster competition, innovation and consumer welfare. DOJ’s praiseworthy move to put pressure on Google comes at a time when AI is taking off and Big Tech threatens to hold sway there.

The actions against Google are also a wake up call to ensure more proactive action by regulators in India against new age sectors. The Competition Act, 2002, was amended last year to account for the distinctive parameters of Big Tech monopoly behaviour, such as ‘network effects’. That the top five tech companies have an annual capex budget that is 50 per cent higher than Indian Government’s surely speaks of another scale and context. Not surprisingly, regulation of this segment even at a global level is at a somewhat nascent stage. India should build guardrails for Internet and AI to ensure that competition gains and consumers benefit.

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