The US Government Takes on Google & Amazon in Attempt to Regulate Big Tech Monopolies

The United States government is taking on big tech in two huge antitrust cases – one against Google – the other against Amazon.

These two suits highlight current government concerns over internet monopolies and the need for legislation to regulate the business practices of large tech companies.

The Google antitrust trial, U.S. et al. v. Google, began a few weeks ago with the prosecution
contending that Google illegally paid off other tech companies like Samsung and Apple in order to prevent them from gaining a foothold in the market of online search engines. (NY Times)

The Amazon lawsuit was filed yesterday by the United States Federal Trade Commission (FTC) and seventeen other states, who allege that Amazon has illegally stifled online retail competition by promoting its own products to the detriment of other merchants and consumers. (NY Times)

The outcomes of both of these lawsuits will have a huge impact on the future of big tech as these conglomerates help make up the foundational infrastructure of the internet and are two of the biggest names in the industry.

Both cases highlight the ongoing debate in America over whether U.S. antitrust laws need to be modernized in order to rein in tech giants and provide more protections to consumers.

The Google lawsuit was filed back in October of 2020, and went to trial a few weeks ago. This is the governments first major monopoly case to make it to trial since they took on Microsoft in 1998 and won. The Google trial is similar to the Microsoft trial with the Justice Department arguing that “Google illegally orchestrated its business dealings, so that it’s the first search engine people see when they turn on their phones and web browsers, with its goal being to wipe out competition.” (NPR)

This is the first major monopoly trial in the age of the modern internet and its outcome will determine “how tech companies are able to amass power and control the products people now use daily in their lives. The outcome of the case could change how tech giants are able to do business and, in effect, how the internet is run.” (NPR)

The prosecution centers its case on the fact that Google paid billions of dollars each year for exclusive agreements with phone makers to be the go to web browser on their devises. The Justice Department argues that these agreements eliminated smaller search engine rivals and has created a monopoly to block meaningful competition in the search engine market. (NPR)

The case is presided over by Judge Amit Mehta, and it is a bench trial which means there is no jury. The trial is expected to last three months and if the judge rules in favor of the Justice Department, Google may be subject to severe sanctions ranging from fines to a total restructuring of the company. (NPR)

The Amazon lawsuit pits the online retail company against Lina Khan, the FTC chair who is arguing that Amazon’s monopoly over online retail has made it impossible for other retailers to compete.

The Amazon lawsuit was filed in U.S. District Court for the Western District of Washington. It alleges that “Amazon is a monopolist. It exploits its monopolies in ways that enrich Amazon but harm its customers: both the tens of millions of American households who regularly shop on Amazon’s online superstore and the hundreds of thousands of businesses who rely on Amazon to reach them.” (NY Times)

In the lawsuit, the FTC has asked the court to issue an injunction to block Amazon from
engaging in unlawful conduct and if successful the suit could lead to the restructure of the

The outcome of these cases will determine how big tech companies operate in the coming years & the impact they have on both national and global economies. This especially important in the context of the growing emergence of Artificial Intelligence (AI).

“Today Google is both interested in and threatened by the large language model technology of companies like OpenAI, which developed ChatGPT. Google has spent many billions of dollars on A.I. research, including developing its own chatbot, Bard, and recently rushed to incorporate dozens of A.I. features into its products.” However, Google may have bitten off more they can chew with trying to balance their existing revenue streams while also pursing the future of AI, and keeping their investors happy. (NY Times)

Meanwhile, two days ago Amazon announced that it would invest up to $4 billion in the AI
startup Antropic, in a bid to compete against other technology companies to control AI
breakthroughs that will reshape how we use the internet. (NY Times)

As Tim Wu writes in the NY times, “ultimately, antitrust law’s most important function is to
rebalance economic power, taming the excesses that are the inevitable consequences of a capitalist economy. The tech industries are prone to monopoly, yet as history suggests, they can be extraordinarily generative when given the right nudge.” (NY Times)

The point of these antitrust lawsuits against Google and Amazon is to provide a check against the power of big tech companies and their impact on consumers, the economy, and internet usage. The outcome of these cases will also pave the way for the emergence of AI technologies leading to new innovations and perhaps new leaders in the tech industry.

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