US authorities have filed a lawsuit against Google that could lead to the division of the company into parts.

The process of the decade has officially started in the United States, the results of which will largely determine the future of digital services and the lives of their customers. The Department of Justice filed a lawsuit against Google for abuse of a monopoly position in the search and online advertising market. Officials compare the trial to AT&T's historic phone monopoly, which saw the company split into nine parts. A forced division of business may also threaten Google - at least, congressmen from the growing Democratic Party insist on this.

What's happened

The lawsuit was filed by the US Department of Justice and the authorities of 11 states, told Deputy Attorney General Jeff Rosen reporters. They accused Google of creating an illegal monopoly in the search market and advertising in search services. The lawsuit does not specify potential sanctions that the plaintiffs will seek to impose on Google, but Ryan Shores, a senior technology industry adviser to the Justice Department, said he did not rule out any options, hinting at the most dire consequences, such as splitting the company. This option is also allowed by lawyers. Google, he said, will be required to abandon all activities that harm competition.

What is important to know

The antitrust lawsuit against Google, which has been in preparation for more than a year, was filed by the US Department of Justice and prosecutors in 11 states, told Deputy Attorney General Jeff Rosen reporters. Google is accused of creating an illegal monopoly in the US Internet search market, 88% of which is controlled by the service, and advertising in search services.

The lawsuit does not specify potential sanctions that the plaintiffs will seek to impose on Google, but Ryan Shores, a senior technology industry adviser to the Justice Department, said he did not rule out any options, hinting at the most dire consequences, such as splitting the company. This option is also allowed by lawyers. Google, he said, will be required to abandon all activities that harm competition.

The Wall Street Journal calls the lawsuit the largest US antitrust case in 20 years. Deputy Minister Rosen compared the case to two historic antitrust cases - 1974 against telephone AT&T, which resulted in the division of the company into 9 regional operators, and 1998 against Microsoft, after which Bill Gates' company narrowly avoided a similar division.

The lawsuit alleges that Google maintained its monopoly status through exclusive rights agreements. For example, the company entered into agreements with technology manufacturers, requiring Google search to be preinstalled on their devices. Often it was not possible to remove Google services from a smartphone or computer. In particular, the lawsuit refers to the collaboration between Google and Apple, which made the Google search engine almost the only search engine built into the Safari browser.

In Russia, Google lost a similar court case to the Federal Antimonopoly Service back in 2016. The company undertook not to interfere with the installation of competing services on Android smartphones and paid a fine of 439 million rubles.

The lawsuit also notes that Google controls with the help of exclusive rights about 90% of all search queries in the United States. And the company receives $40 billion a year from advertisers.

The antitrust lawsuit against Google is a rare and important event, Deputy Minister Rosen said. According to him, if the technology giant is not prevented now, then the “next Google” may never appear on the market, because the current monopolist does not allow competitors to develop.

What's next

Shareholders of Alphabet, the parent company of Google, on the news of the long-awaited lawsuit, not only did not fall, but also grew (+1.87% at 22:20 Moscow time). The market has long considered the prospect of filing a lawsuit, the proceedings will take years, and the plaintiffs have not yet demanded the most radical measures, such as the forced division of the company, analysts explained to Reuters. Alphabet now has $120 billion in cash on its accounts - this will allow the company to easily pay any, even the largest fines, said Dave Hegen, senior analyst at Edward Jones.

Nevertheless, the demand for the division of Google's business is a real prospect. Such a decision (in relation not only to Google, but also to Facebook, Amazon, and Apple) was called acceptable in a report published in early October following an investigation by the Congressional Antitrust Committee. last week And Politico reported that the US Department of Justice is considering selling the Chrome browser and spinning off Google's advertising services as one option.