Google is in the hottest antitrust seat, but Apple and the rest of Big Tech shouldn’t breathe easy
[Google is in the hottest antitrust seat, but Apple and the rest of Big Tech shouldn’t breathe easy | Morningstar](https://www.morningstar.com/news/marketwatch/20210713252/google-is-in-the-hottest-antitrust-seat-but-apple-and-the-rest-of-big-tech-shouldnt-breathe-easy)
**Provided by** **Dow Jones**
Jul 13, 2021 10:11 AM CDT By Jon Swartz
A fifth lawsuit against Google in U.S. — this one focused on Android and its app store — is just part of a wider set of actions that show ‘federal, state, and local government agree: Big Tech is a big problem’
Now facing its fifth government antitrust lawsuit, Google appears to be the biggest target in the wave of Big Tech investigations around the world.
But Alphabet Inc.’s (GOOGL)(GOOGL) internet giant is far from alone. Antitrust experts warn that more inquiries into the biggest tech companies in the world are on the way after President Joe Biden’s non-binding executive order on Friday ([link](https://www.marketwatch.com/story/biden-to-sign-executive-order-that-aims-to-rein-in-big-business-11625835969)), which addressed competition in tech head-on.
“Google isn’t the only one in the crosshairs of policy makers,” antitrust attorney Ashley Keller told MarketWatch, echoing the opinions of legal experts.
Aggressive state legislation is already looking into the sway of Apple Inc.’s (AAPL) App Store while waiting for a decision in the Epic Games Inc. antitrust lawsuit ([link](https://www.marketwatch.com/story/epic-vs-apple-the-predicted-verdict-is-in-11622224463)), and some colorful language in a recent decision on a Federal Trade Commission lawsuit ([link](https://www.marketwatch.com/story/judge-dismisses-facebook-antitrust-suit-brought-by-ftc-11624908957)) against Facebook Inc. (FB) suggests the social network isn’t in the clear. Adding to the climate, Lina Khan’s FTC has its eyes on Amazon.com Inc. (AMZN), reportedly including ([link](https://www.reuters.com/legal/litigation/ftc-extends-probe-amazon-mgm-deal-source-2021-07-09)) its recently announced $8.5 billion acquisition bid for movie studio MGM.
“This is the first time I have seen movement coalesce. Federal, state, and local government agree: Big Tech is a big problem,” said Pat Garofalo, director of state and local policy at the American Economic Liberties Project, a nonprofit organization that researches monopolies and advocates for deconcentration of power in economic markets.
“What they \[government legislators and agencies\] are doing shows the weakness of current antitrust law, and how courts are wedded to a consumer-harm definition of antitrust law,” Garofalo told MarketWatch. “For the antitrust movement to achieve what it wants to achieve, laws have to change.”
The latest Google complaint ([link](https://ag.ny.gov/sites/default/files/utah_v_google.1.complaint_redacted.pdf)), filed in federal court in Northern California by attorneys general in 36 states and the District of Columbia last week, targets the influence of the Android app store, known as the Google Play Store, and the 30% commission fee it levies on developers. It also contends Google imposes technical barriers that “strongly discourage or effectively prevent third-party app developers from distributing apps outside the Google Play Store,” and that the company forces Google’s proprietary apps to be “pre-loaded” on Android devices.
“No matter how big a company is, it has to play by the rules,” North Carolina Attorney General Josh Stein, one of the lead plaintiffs in the Google suit, said in a statement. “Google isn’t. It is using its monopoly power to cut off competition and increase its power and profits at the expense of North Carolina consumers by forcing Google Play Store customers to overpay for apps.”
In a blog post ([link](https://blog.google/outreach-initiatives/public-policy/lawsuit-ignores-choice-android-and-google-play/)), Wilson White, Google’s senior director of public policy, said the lawsuit “completely ignores the competition we face from other platforms such as Apple’s incredibly successful app store, which accounts for the majority of mobile app store revenues ([link](https://appleinsider.com/articles/21/01/05/app-store-earns-723-billion-in-2020-almost-double-google-play-revenues)) according to third-party estimates.”
Apple’s recent battle with “Fortnite” maker Epic Games mirrors many of the same charges — unfair fees and control over the platform. In federal court in Oakland, Calif., earlier this year, Epic hammered with metronomic precision an argument that Apple unfairly rules over its mobile Android rival, iOS, to benefit itself. The argument is also somewhat similar to the government’s approach against Microsoft Corp. (MSFT), when it required its web browser to be bundled with Windows — a dominant operating system favoring its own software (and company) unfairly.
Alphabet has already faced a record $5.15 billion fine because of the way it operates Google’s Play Store, after the European Commission ruled in 2018 that Google used the Android mobile operating system to thwart rivals. Reuters reported ([link](https://finance.yahoo.com/news/google-fight-eu-antitrust-fine-110350321.html))Monday that Google will attempt to reverse that antitrust fine at a five-day hearing in September.
In addition to last week’s suit, Google is the target of search engine-focused lawsuits from the Justice Department and two separate groups of state AGs. Another action, by Ohio Attorney General Dave Yost, seeks a court to declare Google a public utility and to regulate it ([link](https://www.marketwatch.com/story/ohio-ag-sues-google-claiming-its-a-public-utility-11623171305)).
“Google has the most obvious monopoly with its dominance of search as referenced in the DoJ lawsuit,” Julian Baring, president, Americas, at digital-media advertising company Adform, told MarketWatch. “They’ve taken advantage of this to vertically integrate across the whole value chain and extract significant rates and dominate the ad market.”
Google may have the most obviously dominant business, but Facebook, Apple and Amazon could be increasingly vulnerable based on Biden’s executive order, federal investigations, state bills and a new head of the FTC, experts said.
On Friday, President Biden signed a sweeping executive order ([link](https://www.marketwatch.com/story/bidens-executive-order-targeting-big-business-and-competition-full-text-11625858909?mod=home-page)) to apply several antitrust changes, including 72 initiatives involving more than a dozen federal agencies, to spur competition in big business, including tech. After Biden signed the order, he handed the pen to newly minted FTC Chair Khan, who was standing behind him, in a clear message to Big Tech. A few minutes after the event wrapped, news broke that Khan’s FTC may have opened a lengthy probe ([link](https://email.mg2.substack.com/c/eJwlkd2OpCAQhZ-mudMAAo0XXMzNvoZBKJVdBBfKMc7TD92dkKJSP6mT7ziLsOZymyNXJK8w4X2ASXDVCIhQyFmhTMEbOQjJn5p4IzzTUpNQp6UA7DZEg-UEcpxzDM5iyOm1wJjkgmwGmOKzGgbpHXArnB2o5ouTfLQgJV8-Z-3pAyQHBr6h3DkBiWZDPOpj-HrwP-1d19XjBiEtuezvK73Le2vYgsFFqC1d0HX5gFS7o-QZurx0drc_uRX2de-Os7jNVuhqWJONIa2d7SKkFbe7C-n_GcpNguGUM_pkjHFKqepZD167mSqhleJ-5JqxWQnpnso2JuOsH4LuK-_rOVe07t9LFynmb04WN5v6ejWJP23I56sVob4HGq6p_fuZAt4TJDtH8B-S-PHjzXZaIUFpPvnJomksFaVipHpoXrzJNdSDlmochSRNgc9tK5lGCCvmGKH8Ar0tpp4)) into Amazon’s acquisition of MGM studios.
Several bits of the order jumped out at Keller: A focus from the White House on non-compete agreements, which would allow a freer movement of labor among the major players, and a fresh look at mergers that “kinda gives the green light to \[Khan\]” to review Facebook’s acquisitions of Instagram and WhatsApp. Another reference to “access to information of what sellers are selling” has ominous trappings for Amazon’s unfair use of market power, he added.
“Executive orders have immediate impact when they are focused; this one is sweeping, so its impact will be felt across many different debates in Congress, in regulatory agencies and courtrooms and across numerous industries,” Bhaskar Chakravorti, dean of global business at the Fletcher School at Tufts University, told MarketWatch.
The wave of antitrust sentiment against tech has been building steadily for years amid market dominance in search, ad tech, and app stores, Garofalo said — from Facebook’s entanglement in the Cambridge Analytica data debacle, to Amazon’s “brazenness” in awarding its HQ2 campus, to the “obscene power” of every major tech company during the pandemic.
“The pandemic, in particular, got the attention of lawmakers whose states give massive subsidies to help tech companies build out their businesses with data centers and warehouses,” he said.
**Apple’s Epic challenge**
Apple, whose App Store draws similar anticompetitive comparisons to Play Store, is awaiting a federal judge’s decision later this year in Epic’s antitrust claim. Epic has also sued Google in a case that could go to court in 2022. Apple faces charges in the Epic case around its 30% commission fee to many developers, and its competitive policies.
https://www.reddit.com/r/StockMarket/comments/ok2pzq/google_is_in_the_hottest_antitrust_seat_but_apple/