DOJ Suit Against Google Seeks to Expand Antitrust Standard Beyond Consumer Harm

This is a press statement originally posted at cei.org.

WASHINGTON, DC – The Department of Justice filed a lawsuit today alleging Google has broken antitrust laws with its search function and digital advertising practices.

Associate Director of CEI’s Center for Technology and Innovation Jessica Melugin said:

 “In the U.S., the antitrust standard is consumer harm. Consumers enjoy Google’s search without charge and the service continues to improve in quality and expand in offerings, like autocomplete and translations. It will be a heavy lift for the DOJ to show real consumer harm. That this bar is unlikely to be met is precisely why so many antitrust enthusiasts are calling for a fundamental rewriting and expansion of U.S. antitrust laws. Those proposed changes sacrifice the primacy of consumer welfare and insert competitors and broader socio-economic goals in its place. This suit is a mistake; antitrust should not be used to protect inefficient producers at the expense of consumer’s interests.”

 Senior Fellow Ryan Young said:

 “Any antitrust lawsuit against Google is unlikely to accomplish its goals. The Republicans driving the lawsuit want to avenge perceived political bias. An antitrust lawsuit is a strange way to go about regulating political speech.

 “Democrats might take over the Republicans’ lawsuit or file their own case, depending on how the election goes. They are concerned about monopoly power. For example, Google has a major share of online advertising revenues. But online ad prices have fallen by roughly half over the last decade, even as print advertising prices have gone up. Any first-year law student knows that monopolists don’t cut prices.They raise prices, because they have the market power to do so. Google clearly lacks this market power.

 “Nor is using competing search engines difficult. It takes seconds to type ‘DuckDuckGo.com’ or ‘Bing.com’ into your browser—even in Google’s Chrome browser. While Google is the default search option in most smartphones, Microsoft’s experience with Internet Explorer shows that default status matters very little when something better is a dozen keystrokes away. Its newer Chromium-based Edge browser, the new Windows default, has similarly failed to catch on. Consumers rule the search market, not Google.”

 Vice President for Policy Wayne Crews said:

 “The claimed purpose of antitrust is enhancing consumer welfare, but this suit seems more about competitor’s interests. One of the dangerous and unstated goals of antitrust exploitation is to grant lesser competitors forced access to the target’s voluntarily acquired customers without doing the hard work and innovation the target did to win them in the first place. News reports indicate that the DOJ asked rivals and other third parties for their views on which businesses Google should have to sell and which existing competitors should be off-limits as potential buyers in the forced fire sale.  

 “Government asking competitors how it should apply force illustrates the naked character of the rent-seeking involved here specifically and generally. We at least pretend that antitrust is about protecting competition and not competitors, but it seems the most prominent bipartisanship in Washington is to expand government power rather than reduce it.”

For more information about CEI’s work on antitrust, please visit cei.org/antitrust.

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