This is explained in quite a bit of detail in the judge's ruling: https://assets.bwbx.io/documents/users/iqjWHBFdfxIU/rZ1UlL.0... Starting about page 197.

> Google understands there is no genuine competition for the defaults because it knows that its partners cannot afford to go elsewhere. Time and again, Google’s partners have concluded that it is financially infeasible to switch default GSEs or seek greater flexibility in search offerings because it would mean sacrificing the hundreds of millions, if not billions, of dollars that Google pays them as revenue share.

[...]

> That was the key takeaway from the testimony of Neeva’s founder and former Google Senior Vice President of Ads and Commerce, Dr. Ramaswamy. The court found him to be a particularly compelling witness. He put it best. When the court asked why Google pays billions in revenue share when it already has the best search engine, he answered that the payments “provide an incredibly strong incentive for the ecosystem to not do anything”; they “effectively make the ecosystem exceptionally resist[ant] to change”; and their “net effect . . . [is to] basically freeze the ecosystem in place[.]” Tr. at 3796:8–3798:22 (Ramaswamy). No one would ever describe a competitive marketplace in those terms. When the distribution agreements have created an ecosystem that has a “strong incentive” to do “nothing,” is “resist[ant] to change,” and is “basically [frozen] in place,” there is no genuine “competition for the contract” in search. It is illusory.

The court is plain silly if it's concluding that multi-billion-dollar deals create resistance or diminishes incentives. If anything, it creates incentives by proving that another search engine could make billions from smartphone fees alone.

It’s an exclusive deal that prevents anyone else from offering a similar deal. Of course it reduces competition. The only question is whether it also violates the monopoly law.

I’d encourage you to read the decision, I just pulled two paragraphs from a pretty exhaustive document.

I highly encourage you to read about monopolies and their mechanisms. Competitors can be incentivized with a monopoly's profits all they want, the amount of money it'd take to enter the space is unfeasible.

Then what is Google paying others for?

>another search engine could make billions from smartphone fees alone.

I’m not following… the search engine would be the one paying the billions.

They're saying that if Google is willing to pay so much to be the default that there's positive ROI that another search engine could tap given the up-front investment to buy the spot.

This would have been fine if Google was not a monopoly. The key part of the ruling is that judge agrees Google is a monopoly. And it's behavior is maintaining the monopoly illegally.

Because it's a monopoly, and paying over the odds for these placements, it does not allow for a competitive marketplace. These payments create significant barriers to entry for other companies to even try and increase their market share given all the frictionless access points are blocked by Google not because of superior product but payments. These payments from a monopoly have a disproportionate impact on the market by limiting opportunities for everyone else in a significant manner.

(Kind of, in a competitive market, a company can block 1-2 pathways. Here google pretty much blocked every entry point.)

Presumably these deals with Google will be nullified, but can the various browsers just make new deals with someone else? Can Microsoft just just swoop in and make a deal with Apple/Mozilla/Samsung? Mozilla is going to be desperate to find a new partner...

Dont think Apple would make a deal with any other engine. They basically used Microsoft to get a good deal with Google, but never had any intention to use Microsoft.

The thing is the deals are a revenue sharing deal - Google gives 1/3 of the revenue to Apple. With microsoft, the number could be 100% and would still not reach a significant number for Apple. Mozilla would jump at it, and I hope Google still invests in them as part of a grant or something while not getting anything in return.

At least in the short term they probably would. Why not take the basically free money?

Longer term, yeah they'll probably just make their own search engine.

I highly doubt Google would give Mozilla anything. The only reason I think they would would be to appease Chrome monopoly concerns, but I don't think Chrome is even at risk of that. It's not the default browser on any platform other than ChromeOS and some Android devices.

If it creates a monopoly then no, it's not okay, no matter how normal.

Not necessarily - as it is written, the Sherman anti-trust act and all of the amendments distinguishes between "innocent" and "coercive" monopolies. But the definitions are very loose and hard to pin down.

It's hard to even consistently distinguish a monopoly - is it market share? Earning power? Barriers to entry?

> It's hard to even consistently distinguish a monopoly - is it market share? Earning power? Barriers to entry?

"I know it when I see it," as it is difficult at best to rely on distinctive actions or indicators considering the fluidity of business dynamics and the market landscape.

https://en.wikipedia.org/wiki/I_know_it_when_I_see_it

The definitions mean whatever the judge says they mean.

As soon as they formalized a metric to distinguish a monopoly, it would become something deliberately managed by entities who wished to wield monopolistic power.

It would change the shape, but not the definition.

> But the definitions are very loose and hard to pin down.

So are a lot of laws and regulations. Doesn't make them any less valid.

Damn, someone tell the Justice Department that Nvidia exists.

Does Nvidia negotiate deals for all gaming + crypto + AI companies to use their cards, or do they just provide good hardware + software that consumers want to use?

That would be the difference of an anti-competition monopoly vs just a monopoly.

Exactly. Google capitalized on its monopoly status. That's what matters.

If you and I, a couple of presumed nobodies, agree to have our respective companies work together exclusively on a thing and maybe trade some money and services, then that's something that can usually be legally just fine.

But if you or I are operate a monopoly (whether a natural monopoly or an artificial monopoly) and we make the same kind of exclusive deal, then: That may not be fine. We have laws (like the Sherman Act) that can restrict this sort of thing only if a monopoly becomes involved.

And to be clear: It's generally OK to have a monopoly (good fuckin' job, mate! you totally own your market! all the spoils for you!). But it's generally not OK to use that monopoly status in an anticompetitive way.

> Don't companies make exclusive deals all the time,

Companies with monopoly power must work with different rules.

Having monopoly power is not illegal, abusing it is.

Its different in this case because they were just declared a monopoly by the court.

When you are the primary player in the industry, you're creating a massive, unscalable monopolistic wall that no one else can climb.

They pay Apple alone around 20 billion per year. There is no way anyone else can even think about competing with that. It's not because they happened to get the highest bid. It's because they're paying for the elimination of anyone else getting a foothold.

> search engine the default option on smartphone web browsers violate US antitrust law

Interesting that they limit the case to mobile browsers. I guess MS share is significant enough on desktop.

Normal companies can do this, but monopolists cannot. A monopolist may not use a monopoly to create another monopoly.

You can legally have a monopoly, but your hands will be tied in certain aspects, given the power that you could purposely or accidentally wield.

Yeah, they aren't allowed to pay billions anymore. Which begs the question:

What about of money are they allowed to pay?

Will there be a state-run auction?

I feel like the more blatant monopoly abuse by Google is how they use the Google search homepage to shill their other products. They effectively give themselves billions of dollars in free advertising

Because it's much better for the consumer to search for a city, get an interactive map right there on the search results, but no link to jump to Google Maps so they can get an estimate on how long it takes to get there, because that'd be bundling.

Search term: "Detroit"

Search results include: "Explore maps of Detroit on HERE[0], Google Maps[0], OpenStreetMap[0] [...]"

[0] insert link

I'm talking more about them posting new product launches, I/O livestream, gmail pinned to the top, etc. Embedded stuff in search results is fine for the most part, although their intent their is primarily to prevent click throughs to other sites and increase the chances of an ad click

how is that abuse, though?

is it against the law?

IANAL, but I would think not.

I mean, many people put links to their other products or services on the web page of one of their products or services.

It is, if you are leveraging one monopoly to attempt to gain more. This is what happened with Microsoft and Internet Explorer (via the Windows monopoly)[1]

1: https://en.wikipedia.org/wiki/United_States_v._Microsoft_Cor....

Had Microsoft merely provided advertised IE with Windows there never would have been a suit. Even bundling alone would have been a hard case to make. They did far more than just ship IE with Windows.

Oh I agree. I merely meant that they were leveraging an existing monopoly to try to create another one via unfair practices.

linking to my answer in other parts of this thread, since the point and my reply are the same:

https://news.ycombinator.com/item?id=41166997

>They effectively give themselves billions of dollars in free advertising

how the heck is google's " 'giving' themselves something for free", considered wrong? even if it is billions of dollars?

in which alt world is it wrong of you to 'give' yourself a 100 dollars? or even billions? of your own money? or even billions worth of advertising space? both the giver and the receiver are you, right? you are not stealing anything from anyone.

then what the heck is the problem? maybe I am dumb, but I fail to see it.

in your own words, they are giving it to themselves, right?

they are not taking that money away from anyone else.

and note: I am not a Google shill. I criticized them, with some justifications that I gave, roughly about a day ago. check my comments. I try to be objective, though of course I may sometimes fail at that.

interested to hear what you have to say about all this.

They're giving themselves money by abusing their monopoly status. Sure, in a totally free market, it looks innocent. There are laws against this because monopolies are damaging to any market it's in and ends up hurting the end user.

pardon me.

https://en.m.wikipedia.org/wiki/Monopoly

>A monopoly (from Greek μόνος, mónos, 'single, alone' and πωλεῖν, pōleîn, 'to sell'), as described by Irving Fisher, is a market with the "absence of competition", creating a situation where a specific person or enterprise is the only supplier of a particular thing.

how is Google a monopoly according to the above definition in Wikipedia?

they have competitors like bing, duckduckgo, kagi, and some others that i have read about here on hn recently.

and I do not know about the others, but at least bing and duckduckgo have existed for many years.

so again, how are they a monopoly?

Depending on the metric, Google has 90% of the search engine market. Yes they have competition in a literal sense, but not in a meaningful sense.

10% is quite a meaningful share, in an absolute sense. also, 10% of a huge market is, well, huge.

Are you really trying to argue that 90% of the internet text search share held by one company isn't a monopoly?

j-maffe, it looks to me like you are being disingenuous, because in reply to your earlier comment above, I had quoted the Wikipedia definition of monopoly. my entire subsequent argument was based on that, as you well know. if you want to try to redefine terms, or move goalposts, feel free to do so, but I will not participate in an argument based on such behaviour.

to repeat, quoting from the Wikipedia definition of monopoly:

>A monopoly (from Greek μόνος, mónos, 'single, alone' and πωλεῖν, pōleîn, 'to sell'), as described by Irving Fisher, is a market with the "absence of competition", creating a situation where a specific person or enterprise is the only supplier of a particular thing.

(italics mine)

can you really not see the difference between 90% search share held by Google, which means 10% share held by others, vs. absence of competition? it is blindingly obvious.

I am leaving this thread. I don't argue with people who either don't get it, or seem to be operating under false pretences.

your ignoring that, or not understanding that, is like a person saying that 10% is equal to 0%. I cannot argue with such people. it's a dead end, and a waste of my time.

Just to be clear, you're saying that the judge [1], the Justice Department [2], and journalists[3] are all wrong? If you want to be pedantic about it, they have what is called an effective monopoly[4].

[1] https://www.bloomberg.com/news/articles/2024-08-05/google-lo...

[2] https://www.washingtonpost.com/technology/2020/10/20/google-...

[3] https://www.washingtonpost.com/opinions/yes-google-has-a-mon...

[4] http://www2.harpercollege.edu/mhealy/eco211f/lectures/monopo...

I am making a rare exception to my statement about not engaging with you further (because of the crap that you wrote earlier), because of the other crap that you wrote above (only in order to point that crap out to other readers):

half the links (i.e. 1 and 2) you quoted above don't work for me. paywalls or signup required? clever you, eh? not!

and link 4 is too long and verbose. I searched for the word effective, but did not find it in the initial part on the screen.

aaannnddd ... you are quoting journalists (!) as though they are automatically competent authorities? and even judges' decisions sometimes get reversed by higher courts. so effectively you have no point. hee ... hee ... hee ...

looks like, in your arguments, you thrive on appeals to faux authority, and nothing else, particularly not on reasoning.

so, tata, bye bye, dude.

this sort of argument is below me.

bless you. you need it.

how are they a monopoly, as I asked another person in this same thread, here:

https://news.ycombinator.com/item?id=41166997

>how are they a monopoly

they are because a judge just ruled they are. answering questions like this is the reason the courts exist, and they just answered this question.

or they might not actually be a monopoly, there's still a possibility of appeal, but there's really no more definitive answer than a judge's ruling. antitrust law is fuzzy, and depends a lot on the courts to interpret it.

>they are because a judge just ruled they are.

but they are not a monopoly according to the Wikipedia definition that I cited in another subthread, and linked to above, though.

and courts can be packed, which, i have been reading, has happened with the us supreme court.

if you want to beleive a wikipedia definition based on historical caselaw, instead of an actual judge's decision, then i guess sure, do whatever you want.

if you're asking how they're a monopoly, i answered you. if you want to debate whether the judge was right or wrong, maybe phrase your question less like a question.

>if you're asking how they're a monopoly, i answered you. if you want to debate whether the judge was right or wrong, maybe phrase your question less like a question.

okay, i will. in fact, i also answered you, so I'll just link to my other answer again:

https://news.ycombinator.com/item?id=41167248

as you say, antitrust law is fuzzy.

and judges are human, and therefore fallible.

and that judge's ruling can be overturned by an appeals court. and the appeals court's ruling can again be overturned by an even higher court.

such things have happened many times in the past.

so that means that the courts are no more reliable than Wikipedia.

qed. case dismissed. ;)

Scale and context matters. No one else could afford to pay anywhere remotely near what Google is paying Apple. If it was truly competitive bidding Google could just offer some small reasonable percentage more than the nearest competitor could afford and Apple would take it. The reason google is paying so much over where a market price would be is because they want to discourage anyone, particularly Apple, from even thinking about competing with them. Google is paying Apple 36% of the revenue (not profit) generated by those users.

A pretty good argument could be made that Apple would likely have built up and/or acquired it's own search engine by now if Google wasn't paying such obscene amounts. Apple was previously involved in talks with Microsoft to purchase Bing, and even acquired an ai search startup founded by ex-googlers (LaserLike).