Judge Amit Mehra’s ruling declaring Google a monopolist in the search space represents a significant development in the ongoing debate over the market dominance of major technology companies. The decision, which stems from a lawsuit filed by the U.S. Department of Justice, is the result of years of discussions and investigations into antitrust issues in the technology sector, particularly those related to Google’s search practices.

Judge Amit Mehra’s recent ruling declaring Google a search monopolist marks an important milestone in the ongoing debate over Big Tech dominance in the United States (Europe and other jurisdictions reached the same conclusion years ago). No Big Tech company has faced such a landmark antitrust ruling in a U.S. case since the Microsoft antitrust case in the 1990s (Google plans to appeal the ruling, though).

Mehra’s decision, which stems from a lawsuit filed by the U.S. Department of Justice, underscores the need for ongoing analysis, discussion, and debate about market power and the competitive environment in the tech industry. It’s important to remind ourselves of the history of these discussions, as the evolution of the economic analysis of market competition is critical to understanding the ruling, developing effective remedies, and understanding how these factors might impact the future of antitrust enforcement. Rulings on other Department of Justice antitrust lawsuits against Amazon, Apple, Meta, and Google (for adtech) are pending, but since this is the first of the five lawsuits, it may provide insight into how the others might end.

A history of debate

After a 2016 report by the Council of Economic Advisors showed increasing concentration in U.S. markets, professors Luigi Zingales and Guy Rolnik of the University of Chicago Booth School of Business organized a conference for academics and policymakers in 2017 to explore “whether this possible increase in concentration has led to an increase in the market power of firms and whether this increase in market power has led to significant welfare distortions.”

This event was the beginning of a comprehensive Stigler Center investigation into market concentration. Panelists reviewed the empirical evidence supporting claims of too much concentration in the U.S. economy and began to discuss whether antitrust enforcement should be reconsidered. The event featured a wide-ranging conversation between Zingales and Judge Richard Posner, including a debate about Google’s actions. Posner is one of the most influential antitrust experts of the last century and was a judge on the Court of Appeals for the Seventh Circuit in Chicago:

“What was the worst thing Google did?” asked Posner.

“They redirected the searches to a company they owned directly,” Zingales replied.

“I guess that’s bad,” Posner said.

After the conference, the discussion continued on ProMarket, in particular, through a series of interviews with influential academics. The discussions were picked up again the following year, at the 2018 Antitrust and Competition Conference, which specifically focused on digital platforms and how Google “has the power to manipulate opinions from the first letter people type into the search bar.” Discussions centered on how network effects and economies of scale create monopolistic conditions that often make it difficult for new entrants to compete with established players. For example, there was extensive discussion of the dissolution of rewards for innovation and the tendency of tech giants to absorb or copy the upstarts that could become their rivals.

Discussions become mainstream

In 2019, the discussion about antitrust and Big Tech became mainstream. The Stigler Center’s antitrust conferences were held in the New York Times: “The discussions at these two conferences were reflected in recent decisions by the Department of Justice and the Attorneys General of 50 states.”

And the Justice Department was not the only part of the federal government to take notice. The Stigler Center published its groundbreaking “Digital Platforms Report” in 2019. This comprehensive study, which involved over 30 academics analyzing the power of tech giants, was presented to the U.S. Senate Subcommittee on Antitrust by Senator Amy Klobuchar. This followed other similar conclusions by antitrust agencies around the world, initiatives that ProMarket has also covered.

Regarding Google Search specifically, the Stigler Center report states: “Google Search is the dominant company in this category with high barriers to entry; despite the enormous size of this market, venture capitalists appear unwilling to fund a new entrant. In contrast, venture capitalists are attracted to startup teams that solve a specific problem for Google (and have a chance of being acquired) rather than funding a team that wants to compete directly. This dynamic creates a self-fulfilling prophecy.”

In 2020, the Department of Justice filed its antitrust lawsuit against Google’s search performance. Despite the Covid-19 pandemic, discussions continued in a series of webinars in 2020 and 2021. In fact, an episode of the Stigler Center podcast Capital is not examined the evolution of antitrust laws and their application to large technology companies, focusing on the 1998 Microsoft case and drawing parallels with concerns about Google’s market dominance.

The year 2022 brought ProMarket Opportunity to speak with the new head of the Justice Department’s antitrust division, Jonathan Kanter. Kanter said he wants to hold monopolists accountable and enforce antitrust laws more vigorously through litigation.

A panel dedicated to Google at the 2022 conference examined the company’s anti-competitive practices, particularly in search and digital advertising. This panel advanced the discussion on remedies, especially given the EU’s difficulties in achieving tangible results for its enforcement efforts. Panelists proposed various forms of breaking up the company, limiting search results, and forcing certain groups to use Bing, Google’s main search competitor.

Case gains momentum

In fall 2023, when the Google Search case gains momentum, ProMarket published a series of articles by various experts discussing the merits and limitations of the lawsuit. Google had made huge payments (in the order of $18 billion) to become the default search engine for Apple and Mozilla products. Discussions included articles about the unprecedented secrecy surrounding the lawsuit and how it was emblematic of the changing attitude of antitrust regulators toward Big Tech dominance.

At the end of the process, the researchers emphasized that a behavioral economics approach would be helpful in analyzing the consumer nudging that led to Google’s dominance in search in the first place, and what regulating it could mean for the rest of the technology industry.

One conclusion from Mehra’s ruling is that monopolists can exist, even in a zero-price market. Indeed, the lack of users actually paying for search did not prevent Mehra from accepting the definition of the market. The ruling points out that Google “has an 89.2% market share in general search services, which rises to 94.9% on mobile devices.”

What happens next

Google has announced that it will appeal Mehra’s decision, but even before it was announced, academics began discussing what an effective remedy might look like. By 2024, we saw the remediation discussion encompass a range of potential solutions to Google’s search dominance, from behavior-based remedies to structural changes.

Behavioral remedies include prohibiting Google from securing default search engine status through exclusive contracts, introducing choice screens that allow users to select their preferred search engine, and requiring it to share click and query data with competitors. However, there have been concerns that these measures may not be enough to overcome Google’s entrenched market position and brand recognition. Structural remedies, such as divesting Google’s web indexing capabilities or Android operating system, have also been seen as potentially more decisive solutions. Importantly, the remedies applied in this case could set a precedent for future antitrust enforcements in the technology sector.

We won’t know the outcome for several months, or even later, depending on the appeal. But we know that the discussion will continue to evolve and that this ruling will undoubtedly have an impact on the competitive landscape in the United States.

Author Disclosure: The author reports no conflicts of interest. You can read our disclosure policy here.

The articles reflect the opinions of their authors and not necessarily those of the University of Chicago, the Booth School of Business, or its faculty.