U.S. court ruling against Google’s monopoly

Source: The post U.S. court ruling against Google’s monopoly has been created, based on the article “US antitrust ruling against Google and its implications for India” published in “Indian Express” on 10th August 2024

UPSC Syllabus Topic: GS Paper 3 – Indian Economy

Context: The article discusses a U.S. court ruling against Google for violating antitrust laws by maintaining its monopoly in search services. It also examines how this ruling might affect ongoing similar cases in India, considering different market conditions and proposed regulations.

What Was the U.S. Court’s Ruling Against Google?

1. U.S. court ruled that Google violated antitrust laws to maintain its monopoly over general search services and search ads.
2. The judge highlighted Google’s strategy of making itself the “default” search engine, especially on smartphones and web browsers, by paying companies like Apple and Samsung billions of dollars.
3. This “default” status gives Google a significant, unseen advantage over its competitors, as most users stick to the pre-set search engine.

How Does This Ruling Impact Google in India?

1. Impact of U.S. Ruling in India: The U.S. court ruling against Google for antitrust violations primarily targets the American market but has implications for Google’s operations in India, where it faces similar legal challenges.
2. CCI Action: In 2022, the Competition Commission of India fined Google Rs 1337.76 Crores for forcing pre-installation of its apps on Android devices, illustrating Google’s dominant position and similar anti-competitive issues as those identified in the U.S. ruling.

For detailed information on Antitrust cases against Google read this article here

3. Choice for Users: Following the CCI verdict, Google altered its practices in India, allowing users to select their default search engine, showing a direct response to regulatory pressures that mirror actions likely influenced by global legal challenges.

What Are the Differences in Market Conditions Between the U.S. and India?

1. Default Search Engine Impact: In the U.S., Google dominates as the default search engine on many devices. In India, Xiaomi, holding a 19.3% market share, uses the Opera browser, not Google, as the default on its phones.
2. Regulatory Actions: The Competition Commission of India (CCI) fined Google Rs 1337.76 Crores in 2022 for mandatory pre-installation of Google apps on Android devices. Following this, Google allowed Indian users to choose their default search engine, showing a regulatory difference.
3. Browser Preferences: Indian consumers experience different pre-installed search options, unlike the more uniform Google default in the U.S., impacting user choices differently in both markets.

What Does the Proposed Indian Competition Bill Say About Big Tech?

1. The Draft Competition Bill, 2024, aims to regulate large tech companies in India, referred to as Systemically Significant Digital Enterprises (SSDEs).
2. It imposes restrictions on SSDEs to prevent anti-competitive practices.
3. Key provisions include barring these companies from favoring their products and services over others.
4. The Bill also prohibits SSDEs from using or sharing users’ personal data without explicit consent.
5. Big tech companies argue that these regulations would create significant compliance burdens. They claim it could shift their focus away from innovation and research.

Question for practice:

Examine the potential impact of the U.S. court ruling against Google on its operations and regulatory challenges in India, considering the differences in market conditions and the proposed Indian Competition Bill.