That report cited comments made by a RealPage vice president, Jay Parsons, at a meeting with a group of real estate tech executives. Boasting that “one of their company’s signature product’s software [uses] a mysterious algorithm to help landlords push the highest possible rents on tenants,” Parsons wooed landlords. In a since-deleted video, he noted that apartment rents had recently increased by 14.5 percent, bragging that “never before have we seen these numbers” and prodding another executive to agree that RealPage was “driving it, quite honestly.” Business Insider dubbed it landlords’ “secret weapon.”
Back then, critics told ProPublica that “at a minimum,” RealPage’s “algorithm may be artificially inflating rents and stifling competition,” noting that “machines quickly learn” to increase prices “above competitive levels” to “win.”
Today, RealPage’s site notes that “its suite of services is used to manage more than 24 million units worldwide.” The DOJ reported that on top of collecting its customers’ sensitive information—which included rental prices, demand, discounts, vacancy, and lease terms—RealPage also collected data by making “over 50,000 monthly phone calls,” conducting “market surveys” of landlords covering “over 11 million units and approximately 52,000 properties.”
Landlords “knowingly share this nonpublic information with RealPage,” the DOJ said, while “rising rents have disproportionately affected low-income residents.” DOJ Antitrust Division Assistant Attorney General Abigail Slater confirmed the settlement would ensure that RealPage can no longer rely on such nonpublic data to help landlords collude to set rental prices, while advancing the DOJ’s mission of preventing price-fixing algorithms from harming Americans.
“Competing companies must make independent pricing decisions, and with the rise of algorithmic and artificial intelligence tools, we will remain at the forefront of vigorous antitrust enforcement,” Slater said.
People are “bored” by their friends’ content, judge ruled, siding with Meta.
Mark Zuckerberg arrives at court after The Federal Trade Commission alleged the acquisitions of Instagram in 2012 and WhatsApp in 2014 gave Meta a social media monopoly. Credit: Bloomberg / Contributor | Bloomberg
After years of pushback from the Federal Trade Commission over Meta’s acquisitions of Instagram and WhatsApp, Meta has defeated the FTC’s monopoly claims.
In a Tuesday ruling, US District Judge James Boasberg said the FTC failed to show that Meta has a monopoly in a market dubbed “personal social networking.” In that narrowly defined market, the FTC unsuccessfully argued, Meta supposedly faces only two rivals, Snapchat and MeWe, which struggle to compete due to its alleged monopoly.
But the days of grouping apps into “separate markets of social networking and social media” are over, Boasberg wrote. He cited the Greek philosopher Heraclitus, who “posited that no man can ever step into the same river twice,” while telling the FTC they missed their chance to block Meta’s purchase.
“When the evidence implies that consumers are reallocating massive amounts of time from Meta’s apps to these rivals and that the amount of substitution has forced Meta to invest gobs of cash to keep up, the answer is clear: Meta is not a monopolist insulated from competition,” Boasberg wrote.
In fact, adding just TikTok alone to the market defeated the FTC’s claims, Boasberg wrote, leaving him to conclude that “Meta holds no monopoly in the relevant market.”
The FTC is not happy about the loss, which comes after Boasberg determined that one of the agency’s key expert witnesses, Scott Hemphill, could not have approached his testimony “with an open mind.” According to Boasberg, Hemphill was aligned with figures publicly calling for the breakup of Facebook, and that made “neutral evaluation of his opinions more difficult” in a case with little direct evidence of monopoly harms.
“We are deeply disappointed in this decision,” Joe Simonson, the FTC’s director of public affairs, told CNBC. “The deck was always stacked against us with Judge Boasberg, who is currently facing articles of impeachment. We are reviewing all our options.”
For Meta, the win ends years of FTC fights intended to break up the company’s family of apps: Facebook, Instagram, and WhatsApp.
“The Court’s decision today recognizes that Meta faces fierce competition,” Jennifer Newstead, Meta’s chief legal officer, said. “Our products are beneficial for people and businesses and exemplify American innovation and economic growth. We look forward to continuing to partner with the Administration and to invest in America.”
Reels’ popularity helped save Meta
Meta app users clicking on Reels helped Meta win.
Boasberg noted that “a majority of Americans’ time” on both Facebook and Instagram “is now spent watching videos,” with Reels becoming “the single most-used part of Facebook.” That puts Meta apps more on par with entertainment apps like TikTok and YouTube, the judge said.
While “connecting with friends remains an important part of both apps,” the judge cited Meta’s evidence showing that Meta had to pump more recommended content from strangers into users’ feeds to account for a trend where its users grew increasingly less inclined to post publicly.
“Both scrolling and sharing have transformed” since Facebook was founded, Boasberg wrote, citing six factors that he concluded invalidated the FTC’s market definition as markets exist today.
Initial factors that shifted markets were due to leaps in innovation. “First, smartphone usage exploded,” Boasberg explained, then “cell phone data got better,” which made it easier to watch videos without frustrating “freezing and buffering.” Soon after, content recommendation systems got better, with “advanced AI algorithms” helping users “find engaging videos about the things” they “care most about in the world.”
Other factors stemmed from social changes, the judge suggested, describing the fourth factor as a trend where Meta app users started feeling “increasingly bored by their friends’ posts.”
“Longtime users’ friend lists” start fresh, but over time, they “become an often-outdated archive of people they once knew: a casual friend from college, a long-ago friend from summer camp, some guy they met at a party once,” Boasberg wrote. “Posts from friends have therefore grown less interesting.”
Then came TikTok, the fifth factor, Boasberg said, which forced Meta to “evolve” Facebook and Instagram by adding Reels.
And finally, “those five changes both caused and were reinforced by a change in social norms, which evolved to discourage public posting,” Boasberg wrote. “People have increasingly become less interested in blasting out public posts that hundreds of others can see.”
As a result of these tech advancements and social trends, Boasberg said, “Facebook, Instagram, TikTok, and YouTube have thus evolved to have nearly identical main features.” That reality undermined the FTC’s claims that users preferred Facebook and Instagram before Meta shifted its focus away from friends-and-family content.
“The Court simply does not find it credible that users would prefer the Facebook and Instagram apps that existed ten years ago to the versions that exist today,” Boasberg wrote.
Meta apps have not deteriorated, judge ruled
Boasberg repeatedly emphasized that the FTC failed to prove that Meta has a monopoly “now,” either actively or imminently causing harms.
The FTC tried to win by claiming that “Meta has degraded its apps’ quality by increasing their ad load, that falling user sentiment shows that the apps have deteriorated and that Meta has sabotaged its apps by underinvesting in friend sharing,” Boasberg noted.
But, Boasberg said, the FTC failed to show that Meta’s app quality has diminished—a trend that Cory Doctorow dubbed “enshittification,” which Meta apparently successfully argued is not real.
The judge was also swayed by Meta’s arguments that users like seeing ads. Meta showed evidence that it can only profitably increase its ad load when ad quality improves; otherwise, it risks losing engagement. Because “the rate at which users buy something or subscribe to a service based on Meta’s ads has steadily risen,” this suggested “that the ads have gotten more and more likely to connect users to products in which they have an interest,” Boasberg said.
Additionally, surveys of Meta app users that show declining user sentiment are not evidence that its apps are deteriorating in quality, Boasberg said, but are more about “brand reputation.”
“That is unsurprising: ask people how they feel about, say, Exxon Mobil, and their answers will tell you very little about how good its oil is,” Boasberg wrote. “The FTC’s claim that worsening sentiment shows a worsening product is unpersuasive.”
Finally, the FTC’s claim that Meta underinvested in friends-and-family content, to the detriment of its core app users, “makes no sense,” Boasberg wrote, given Meta’s data showing that user posting declined.
“While it is true that users see less content from their friends these days, that is largely due to the friends themselves: people simply post less,” Boasberg wrote. “Users are not seeing less friend content because Meta is hiding it from them, but instead because there is less friend content for Meta to show.”
It’s not even “clear that users want more friend posts,” the judge noted, agreeing with Meta that “instead, what users really seem to want is Reels.”
Further, if Meta were a monopolist, Boasberg seemed to suggest that the platform might be more invested in forcing friends-and-family content than Reels, since “Reels earns Meta less money” due to its smaller ad load.
“Courts presume that sophisticated corporations act rationally,” Boasberg wrote. “Here, the FTC has not offered even an ordinarily persuasive case that Meta is making the economically irrational choice to underinvest in its most lucrative offerings. It certainly has not made a particularly persuasive one.”
Among the critics unhappy with the ruling is Nidhi Hegde, executive director of the American Economic Liberties Project, who suggested that Boasberg’s ruling was “a colossally wrong decision” that “turns a willful blind eye to Meta’s enormous power over social media and the harms that flow from it.”
“Judge Boasberg has purposefully ignored the overwhelming evidence of how Meta became a monopoly—not by building a better product, but by buying its rivals to shut down any real competitors before they could grow,” Hegde said. “These deals let Meta fuse Facebook, Instagram, and WhatsApp into one machine that poisons our children and discourse, bullies publishers and advertisers, and destroys the possibility of healthy online connections with friends and family. By pretending that TikTok’s rise wipes away over a decade of illegal conduct, this court has effectively told every aspiring monopolist that our current justice system is on their side.”
On the other side, industry groups cheered the ruling. Matt Schruers, president of the Computer & Communications Industry Association, suggested that Boasberg concluded “what every Internet user knows—that Meta competes with a number of platforms and the company’s relevant market shares are therefore nowhere close to those required to establish monopoly power.”
Ashley is a senior policy reporter for Ars Technica, dedicated to tracking social impacts of emerging policies and new technologies. She is a Chicago-based journalist with 20 years of experience.
FTC’s “entire” monopoly case rests on decade-old emails, Meta argued.
Starting the Federal Trade Commission (FTC) antitrust trial Monday with a bang, Daniel Matheson, the FTC’s lead litigator, flagged a “smoking gun”—a 2012 email where Mark Zuckerberg suggested that Facebook could buy Instagram to “neutralize a potential competitor,” The New York Times reported.
And in “another banger of an email from Zuckerberg,” Brendan Benedict, an antitrust expert monitoring the trial for Big Tech on Trial, posted on X that the Meta CEO wrote, “Messenger isn’t beating WhatsApp. Instagram was growing so much faster than us that we had to buy them for $1 billion… that’s not exactly killing it.”
These messages and others, the FTC hopes to convince the court, provide evidence that Zuckerberg runs Meta by the mantra “it’s better to buy than compete”—seemingly for more than a decade intent on growing the Facebook empire by killing off rivals, allegedly in violation of antitrust law. Another message from Zuckerberg exhibited at trial, Benedict noted on X, suggests Facebook tried to buy yet another rival, Snapchat, for $6 billion.
“We should probably prepare for a leak that we offered $6b… and all the negative [attention] that will come from that,” the Zuckerberg message said.
At the trial, Matheson suggested that “Meta broke the deal” that firms have in the US to compete to succeed, allegedly deciding “that competition was too hard, and it would be easier to buy out their rivals than to compete with them,” the NYT reported. Ultimately, it will be up to the FTC to prove that Meta couldn’t have achieved its dominance today without buying Instagram and WhatsApp (in 2012 and 2014, respectively), while legal experts told the NYT that it is “extremely rare” to unwind mergers approved so many years ago.
Later today, Zuckerberg will take the stand and testify for perhaps seven hours, likely being made to answer for these messages and more. According to the NYT, the FTC will present a paper trail of emails where Zuckerberg and other Meta executives make it clear that acquisitions were intended to remove threats to Facebook’s dominance in the market.
It’s apparent that Meta plans to argue that it doesn’t matter what Zuckerberg or other executives intended when pursuing acquisitions. In a pretrial brief, Meta argued that “the FTC’s case rests almost entirely on emails (many more than a decade old) allegedly expressing competitive concerns” but suggested that this is only “intent” evidence, “without any evidence of anticompetitive effects.”
FTC may force Meta to spin off Instagram, WhatsApp
It is the FTC’s burden to show that Meta’s acquisitions harmed consumers and the market (and those harms outweigh any believable pro-competitive benefits alleged by Meta), but it remains to be seen whether Meta will devote ample time to testifying that “Mark Zuckerberg got it wrong” when describing his rationale for acquisitions, Big Tech on Trial noted.
Meta’s lead lawyer, Mark Hansen, told Law360 that “what people thought at Meta is not really what this case is.” (For those keeping track of who’s who in this case, Hansen apparently once was the boss of James Boasberg, the judge in the case, Big Tech on Trial reported.)
The social media company hopes to convince the court that the FTC’s case is political. So far, Meta has accused the FTC of shifting its market definition while willfully overlooking today’s competitive realities online, simply to punish a tech giant for its success.
In a blog post on Sunday, Meta’s chief legal officer, Jennifer Newstead, accused the FTC of lobbing a “weak case” that “ignores reality.” Meta insists that the FTC has “gerrymandered a fictitious market” to exclude Meta’s actual rivals, like TikTok, X, YouTube, or LinkedIn.
Boasberg will be scrutinizing the market definition, as well as alleged harms, and the FTC will potentially struggle to win him over on the merits of their case. Big Tech on Trial—which suggested that Meta’s acquisitions, if intended to kill off rivals, would be considered “a textbook violation of the antitrust laws”—noted that the court previously told the FTC that the agency had an “uphill climb” in proving its market definition. And because Meta’s social platforms are free, it’s harder to show direct evidence of consumer harms, experts have noted.
Still, for Meta, the stakes are high, as the FTC could pursue a breakup of the company, including requiring Meta to spin off WhatsApp and Instagram. Losing Instagram would hit Meta’s revenue hard, as Instagram is supposed to bring in more than half of its US ad revenue in 2025, eMarketer forecasted last December.
The trial is expected to last eight weeks, but much of the most-anticipated testimony will come early. Facebook’s former chief operating officer, Sheryl Sandberg, as well as Kevin Systrom, co-founder of Instagram, are expected to testify this week.
All unsealed emails and exhibits will eventually be posted on a website jointly managed by the FTC and Meta, but Ars was not yet provided a link or timeline for when the public evidence will be posted online.
Meta mocks FTC’s “ad load theory”
The FTC is arguing that Meta overpaid to acquire Instagram and WhatsApp to maintain an alleged monopoly in the personal social networking market that includes rivals like Snapchat and MeWe, a social networking platform that brands itself as a privacy-focused Facebook alternative.
In opening arguments, the FTC alleged that once competition was eliminated, Meta then degraded the quality of its platforms by limiting user privacy and inundating users with ads.
Meta has defended its acquisitions by arguing that it has improved Instagram and WhatsApp. At trial, Meta’s lawyer Hansen made light of the FTC’s “ad load theory,” stirring laughter in the reportedly packed courtroom, Benedict posted on X.
“If you don’t like an ad, you scroll past it. It takes about a second,” Hansen said.
Meanwhile, Newstead, who reportedly attended opening arguments, argued in her blog that “Instagram and WhatsApp provide a model for what successful acquisitions can achieve: Meta has made Instagram and WhatsApp better, more reliable and more secure through billions of dollars and millions of hours of investment.”
By breaking up these acquisitions, Hansen argued, the FTC would be sending a strong message to startups that “would kill entrepreneurship” by seemingly taking mergers and acquisitions “off the table,” Benedict posted on X.
To defeat the FTC, Meta will likely attempt to broaden the market definition to include more rivals. In support of that, Meta has already pointed to the recent TikTok ban driving TikTok users to Instagram, which allegedly shows the platforms are interchangeable, despite the FTC differentiating TikTok as a video app.
The FTC will likely lean on Meta’s internal documents to show who Meta actually considers rivals. During opening arguments, for example, the FTC reportedly shared a Meta document showing that Meta itself has agreed with the FTC and differentiated Facebook as connecting “friends and family,” while “LinkedIn connects coworkers” and “Nextdoor connects neighbors.”
“Contemporaneous records reveal that Meta and other social media executives understood that users flock to different platforms for different purposes and that Facebook, Instagram, and WhatsApp were specifically designed to operate in a distinct submarket for family and friend connections,” the American Economic Liberties Project, which is partnering with Big Tech on Trial to monitoring the proceedings, said in a press statement.
But Newstead suggested that “evidence of fierce and increasing competition in the market has only grown in the four years since the FTC’s complaint was filed,” and Meta now “faces strong competition in a rapidly shifting tech landscape that includes American and foreign competitors.”
To emphasize the threats to US consumers and businesses, Newstead also invoked the supposed threat to America’s AI leadership if one of the country’s leading tech companies loses momentum at this key moment.
“It’s absurd that the FTC is trying to break up a great American company at the same time the Administration is trying to save Chinese-owned TikTok,” Newstead said. “And, it makes no sense for regulators to try and weaken US companies right at the moment we most need them to invest in winning the competition with China for leadership in AI.”
Trump’s FTC appears unlikely to back down
Zuckerberg has been criticized for his supposed last-ditch attempts to push the Trump administration to pause or toss the FTC’s case. Last month, the CEO visited Trump in the Oval Office to discuss a settlement, Politico reported, apparently worrying officials who don’t want Trump to bail out Meta.
On Monday, the FTC did not appear to be wavering, however, prompting alarm bells in the tech industry.
Patrick Hedger, the director of policy for NetChoice—a trade group that represents Meta and other Big Tech companies—warned that if the FTC undoes Meta’s acquisitions, it would harm innovation and competition while damaging trust in the FTC long-term.
“This bait-and-switch against Meta for acquisitions approved over 10 years ago in the fiercely competitive social media marketplace will have serious ripple effects not only for the US tech industry, but across all American businesses,” Hedger said.
Seemingly accusing Donald Trump’s FTC of pursuing Lina Khan’s alleged agenda against Big Tech, Hedger added that “with Meta at the forefront of open-source AI innovation and a global competitor, the outcome of this trial will have spillover into the entire economy. It will create a fear among businesses that making future, pro-competitive investments could be reversed due to political discontent—not the necessary evidence traditionally required for an anticompetitive claim.”
But Trump’s FTC seems determined to proceed in attempts to disrupt Meta’s business. FTC Chair Andrew Ferguson told Fox Business Monday that “antitrust laws can help make sure that no private sector company gets so powerful that it affects our lives in ways that are really bad for all Americans,” and “that’s what this trial beginning today is all about.”
Ashley is a senior policy reporter for Ars Technica, dedicated to tracking social impacts of emerging policies and new technologies. She is a Chicago-based journalist with 20 years of experience.
Google reportedly wants the US Federal Trade Commission (FTC) to end Microsoft’s exclusive cloud deal with OpenAI that requires anyone wanting access to OpenAI’s models to go through Microsoft’s servers.
Someone “directly involved” in Google’s effort told The Information that Google’s request came after the FTC began broadly probing how Microsoft’s cloud computing business practices may be harming competition.
As part of the FTC’s investigation, the agency apparently asked Microsoft’s biggest rivals if the exclusive OpenAI deal was “preventing them from competing in the burgeoning artificial intelligence market,” multiple sources told The Information. Google reportedly was among those arguing that the deal harms competition by saddling rivals with extra costs and blocking them from hosting OpenAI’s latest models themselves.
In 2024 alone, Microsoft generated about $1 billion from reselling OpenAI’s large language models (LLMs), The Information reported, while rivals were stuck paying to train staff to move data to Microsoft servers if their customers wanted access to OpenAI technology. For one customer, Intuit, it cost millions monthly to access OpenAI models on Microsoft’s servers, The Information reported.
Microsoft benefits from the arrangement—which is not necessarily illegal—of increased revenue from reselling LLMs and renting out more cloud servers. It also takes a 20 percent cut of OpenAI’s revenue. Last year, OpenAI made approximately $3 billion selling its LLMs to customers like T-Mobile and Walmart, The Information reported.
Microsoft’s agreement with OpenAI could be viewed as anti-competitive if businesses convince the FTC that the costs of switching to Microsoft’s servers to access OpenAI technology is so burdensome that it’s unfairly disadvantaging rivals. It could also be considered harming the market and hampering innovation by seemingly disincentivizing Microsoft from competing with OpenAI in the market.
To avoid any disruption to the deal, however, Microsoft could simply point to AI models sold by Google and Amazon as proof of “robust competition,” The Information noted. The FTC may not buy that defense, though, since rivals’ AI models significantly fall behind OpenAI’s models in sales. Any perception that the AI market is being foreclosed by an entrenched major player could trigger intense scrutiny as the US seeks to become a world leader in AI technology development.
Judge: AI will likely play “larger role” in Google search remedies as market shifts.
Google got some disappointing news at a status conference Tuesday, where US District Judge Amit Mehta suggested that Google’s AI products may be restricted as an appropriate remedy following the government’s win in the search monopoly trial.
According to Law360, Mehta said that “the recent emergence of AI products that are intended to mimic the functionality of search engines” is rapidly shifting the search market. Because the judge is now weighing preventive measures to combat Google’s anticompetitive behavior, the judge wants to hear much more about how each side views AI’s role in Google’s search empire during the remedies stage of litigation than he did during the search trial.
“AI and the integration of AI is only going to play a much larger role, it seems to me, in the remedy phase than it did in the liability phase,” Mehta said. “Is that because of the remedies being requested? Perhaps. But is it also potentially because the market that we have all been discussing has shifted?”
To fight the DOJ’s proposed remedies, Google is seemingly dragging its major AI rivals into the trial. Trying to prove that remedies would harm Google’s ability to compete, the tech company is currently trying to pry into Microsoft’s AI deals, including its $13 billion investment in OpenAI, Law360 reported. At least preliminarily, Mehta has agreed that information Google is seeking from rivals has “core relevance” to the remedies litigation, Law360 reported.
The DOJ has asked for a wide range of remedies to stop Google from potentially using AI to entrench its market dominance in search and search text advertising. They include a ban on exclusive agreements with publishers to train on content, which the DOJ fears might allow Google to block AI rivals from licensing data, potentially posing a barrier to entry in both markets. Under the proposed remedies, Google would also face restrictions on investments in or acquisitions of AI products, as well as mergers with AI companies.
Additionally, the DOJ wants Mehta to stop Google from any potential self-preferencing, such as making an AI product mandatory on Android devices Google controls or preventing a rival from distribution on Android devices.
The government seems very concerned that Google may use its ownership of Android to play games in the emerging AI sector. They’ve further recommended an order preventing Google from discouraging partners from working with rivals, degrading the quality of rivals’ AI products on Android devices, or otherwise “coercing” manufacturers or other Android partners into giving Google’s AI products “better treatment.”
Importantly, if the court orders AI remedies linked to Google’s control of Android, Google could risk a forced sale of Android if Mehta grants the DOJ’s request for “contingent structural relief” requiring divestiture of Android if behavioral remedies don’t destroy the current monopolies.
Finally, the government wants Google to be required to allow publishers to opt out of AI training without impacting their search rankings. (Currently, opting out of AI scraping automatically opts sites out of Google search indexing.)
All of this, the DOJ alleged, is necessary to clear the way for a thriving search market as AI stands to shake up the competitive landscape.
“The promise of new technologies, including advances in artificial intelligence (AI), may present an opportunity for fresh competition,” the DOJ said in a court filing. “But only a comprehensive set of remedies can thaw the ecosystem and finally reverse years of anticompetitive effects.”
At the status conference Tuesday, DOJ attorney David Dahlquist reiterated to Mehta that these remedies are needed so that Google’s illegal conduct in search doesn’t extend to this “new frontier” of search, Law360 reported. Dahlquist also clarified that the DOJ views these kinds of AI products “as new access points for search, rather than a whole new market.”
“We’re very concerned about Google’s conduct being a barrier to entry,” Dahlquist said.
Google could not immediately be reached for comment. But the search giant has maintained that AI is beyond the scope of the search trial.
During the status conference, Google attorney John E. Schmidtlein disputed that AI remedies are relevant. While he agreed that “AI is key to the future of search,” he warned that “extraordinary” proposed remedies would “hobble” Google’s AI innovation, Law360 reported.
Microsoft shields confidential AI deals
Microsoft is predictably protective of its AI deals, arguing in a court filing that its “highly confidential agreements with OpenAI, Perplexity AI, Inflection, and G42 are not relevant to the issues being litigated” in the Google trial.
According to Microsoft, Google is arguing that it needs this information to “shed light” on things like “the extent to which the OpenAI partnership has driven new traffic to Bing and otherwise affected Microsoft’s competitive standing” or what’s required by “terms upon which Bing powers functionality incorporated into Perplexity’s search service.”
These insights, Google seemingly hopes, will convince Mehta that Google’s AI deals and investments are the norm in the AI search sector. But Microsoft is currently blocking access, arguing that “Google has done nothing to explain why” it “needs access to the terms of Microsoft’s highly confidential agreements with other third parties” when Microsoft has already offered to share documents “regarding the distribution and competitive position” of its AI products.
Microsoft also opposes Google’s attempts to review how search click-and-query data is used to train OpenAI’s models. Those requests would be better directed at OpenAI, Microsoft said.
If Microsoft gets its way, Google’s discovery requests will be limited to just Microsoft’s content licensing agreements for Copilot. Microsoft alleged those are the only deals “related to the general search or the general search text advertising markets” at issue in the trial.
On Tuesday, Microsoft attorney Julia Chapman told Mehta that Microsoft had “agreed to provide documents about the data used to train its own AI model and also raised concerns about the competitive sensitivity of Microsoft’s agreements with AI companies,” Law360 reported.
It remains unclear at this time if OpenAI will be forced to give Google the click-and-query data Google seeks. At the status hearing, Mehta ordered OpenAI to share “financial statements, information about the training data for ChatGPT, and assessments of the company’s competitive position,” Law360 reported.
But the DOJ may also be interested in seeing that data. In their proposed final judgment, the government forecasted that “query-based AI solutions” will “provide the most likely long-term path for a new generation of search competitors.”
Because of that prediction, any remedy “must prevent Google from frustrating or circumventing” court-ordered changes “by manipulating the development and deployment of new technologies like query-based AI solutions.” Emerging rivals “will depend on the absence of anticompetitive constraints to evolve into full-fledged competitors and competitive threats,” the DOJ alleged.
Mehta seemingly wants to see the evidence supporting the DOJ’s predictions, which could end up exposing carefully guarded secrets of both Google’s and its biggest rivals’ AI deals.
On Tuesday, the judge noted that integration of AI into search engines had already evolved what search results pages look like. And from his “very layperson’s perspective,” it seems like AI’s integration into search engines will continue moving “very quickly,” as both parties seem to agree.
Whether he buys into the DOJ’s theory that Google could use its existing advantage as the world’s greatest gatherer of search query data to block rivals from keeping pace is still up in the air, but the judge seems moved by the DOJ’s claim that “AI has the ability to affect market dynamics in these industries today as well as tomorrow.”
Ashley is a senior policy reporter for Ars Technica, dedicated to tracking social impacts of emerging policies and new technologies. She is a Chicago-based journalist with 20 years of experience.
One of the fastest monopoly trials on record wound down Monday, as US District Court Judge Leonie Brinkema heard closing arguments on Google’s alleged monopoly in a case over the company’s ad tech.
Department of Justice lawyer Aaron Teitelbaum kicked things off by telling Brinkema that Google “rigged” ad auctions, allegedly controlling “multiple parts” of services used to place ads all over the Internet, unfairly advantaging itself in three markets, The New York Times reported.
“Google is once, twice, three times a monopolist,” Teitelbaum said, while reinforcing that “these are the markets that make the free and open Internet possible.”
Teitelbaum likened Google to a “predator,” preying on publishers that allegedly had no viable other options for ad revenue but to stick with Google’s products. An executive for News Corp. testified that the news organization felt it was being held “hostage” because it risked losing $9 million in 2017 if it walked away from Google’s advertising platform.
Brinkema, who wasted no time and frequently urged lawyers to avoid repeating themselves or dragging out litigation with unnecessary testimony throughout the trial, reportedly pushed back.
In one instance she asked, “What would happen if a company had produced the best product,” but Teitelbaum rejected the idea that Google’s ad tech platform had competed on the merits.
“The problem is Google hasn’t done that,” Teitelbaum said, alleging that instead better emerging products “died out,” unable to compete on the merits.
According to Vidushi Dyall, the director of legal analysis for the Chamber of Progress (a trade group representing Google), this lack of advertiser testimony or evidence of better products could be key flaws in the DOJ’s argument. When Brinkema asked what better products Google had stamped out, the DOJ came up blank, Dyall posted in a thread on X (formerly Twitter).
Further, Dyall wrote, Brinkema “noted that the DOJ’s case was notably absent of direct testimony from advertisers.” The judge apparently criticized the DOJ for focusing too much on how publishers were harmed while providing “no direct evidence about advertisers and how satisfied/dissatisfied they are with the system,” Dyall wrote.
Hepner expects that the DOJ plan may be measured enough that the court may only “be interested in a nip-tuck, not a wholesale revision of what plaintiffs have put forward.”
Kamyl Bazbaz, SVP of public affairs for Google’s more privacy-focused rival DuckDuckGo, released a statement agreeing with Hepner.
“The government has put forward a proposal that would free the search market from Google’s illegal grip and unleash a new era of innovation, investment, and competition,” Bazbaz said. “There’s nothing radical about this proposal: It’s firmly based on the court’s extensive finding of fact and proposes solutions in line with previous antitrust actions.”
Bazbaz accused Google of “cynically” invoking privacy among chief concerns with a forced Chrome sale. That “is rich coming from the Internet’s biggest tracker,” Bazbaz said.
Will Apple finally compete with Google in search?
The remedies the DOJ has proposed could potentially be game-changing, Bazbaz told Ars, not just for existing rivals but also new rivals and startups the court found were previously unable to enter the market while it was under Google’s control.
If the DOJ gets its way, Google could be stuck complying with these proposed remedies for 10 years. But if the company can prove after five years that competition has substantially increased and it controls less than 50 percent of the market, the remedies could be terminated early, the DOJ’s proposed final judgment order said.
That’s likely cold comfort for Google as it prepares to fight the DOJ’s plan to break up its search empire and potentially face major new competitors. The biggest risk to Google’s dominance in AI search could even be its former partner, whom the court found was being paid handsomely to help prop up Google’s search monopoly: Apple.
On X (formerly Twitter), Hepner said that cutting off Google’s $20 billion payments to Apple for default placements in Safari alone could “have a huge effect and may finally kick Apple to enter the market itself.”
“Right now, China is afraid of Google,” Trump said at a Chicago event. If that threat were dismantled, Trump suggested, China could become a greater threat to the US, because the US needs to have “great companies” to compete.
Trump’s comments came about a week after the US Department of Justice proposed remedies in the Google monopoly trial, including mulling a breakup.
“I’m not a fan of Google,” Trump insisted. “They treat me badly. But are you going to destroy the company by doing that? If you do that, are you going to destroy the company? What you can do, without breaking it up, is make sure it’s more fair.”
Now that Trump is presumed to soon be taking office before the remedies phase of the DOJ’s litigation ends next year, it seems possible that Trump may sway the DOJ away from breaking up Google.
Experts told Reuters that a final ruling isn’t expected until August, giving Trump plenty of time to possibly influence the DOJ’s case. But Trump’s stance on Google has seemed to shift throughout his campaign, so there’s no predicting his position once he takes power.
Business Insider noted that Trump was extremely critical of Google on the campaign trail, vowing to “do something” to curtail Google’s power after accusing the search giant of only highlighting negative stories about him in search results. (Google has repeatedly denied the accusation.) On Truth Social as recently as September, Trump vowed to prosecute Google “at the maximum levels,” seemingly less concerned then about how this could influence competition with China.
It would be unusual for Trump to meddle with the DOJ’s ongoing litigation, antitrust expert George Hay told Business Insider, but then again, “Trump is a bit more of a wild card.”
“It’s very rare that, at the presidential level, there’s any attempt to influence the course of cases which have already been filed. Those have a life of their own,” Hay said. “They depend on the judge, the courts, the lawyers who carry on a case. It’s extraordinarily unusual for the administration to become at all active.”
Trump may still feel some ownership over the DOJ’s investigation into Google’s core business since it began in 2019 under his administration, and tensions between Trump and Google have not diminished much since. The Verge noted that Trump warned Google to “be careful” in August because he “had a feeling Google is going to be close to shut down.” And earlier this year, Trump’s running mate, JD Vance, called for Google’s breakup on X (formerly Twitter), proclaiming that a stop to Google’s “monopolistic control of information” was “long overdue.”
Trump’s on-and-off feud with Google
For Trump, disabling Google’s search monopoly might feel personal, as he has spent years accusing Google of manipulating results to disfavor him.
His feud with Google appear to have begun in 2016 when Trump falsely accused Google of manipulating votes, claiming Google wanted to make it appear that he didn’t have a “big victory” over Hillary Clinton, CNN reported.
The feud continued through the 2020 election, Politico reported, with Trump warning Google that his administration was “watching Google very closely” after a former Google employee went on Fox News to claim that Google search results were biased against Trump. Google disputed the employee’s report.
And yet throughout this feud, there have also been times where Trump seems to warm to Google. During his last administration, he backtracked a threat to investigate Google’s alleged work with China’s military, Politico noted, after meeting with Google CEO Sundar Pichai. Most recently, he claimed Pichai reached out to praise Trump’s ability to trend on the search engine during Trump’s McDonald’s campaign stunt, SF Gate reported.
So far, Google is not commenting on Trump’s comments on the DOJ’s proposed breakup of its search business. But Pichai did send an internal memo to Google staff on the night before the election, The Verge reported, praising them for boosting accurate information during the US election and reminding them that “the outcome will be a major topic of conversation in living rooms and other places around the world.”
At a time when Trump might continue heavily criticizing Google from the Oval Office, Pichai told Googlers that maintaining trust in Google is a top priority.
“Whomever the voters entrust, let’s remember the role we play at work, through the products we build and as a business: to be a trusted source of information to people of every background and belief,” Pichai’s memo said. “We will and must maintain that.”
The DOJ may not even want to seek a breakup
When the DOJ finally proposed a framework for remedies last month, they emphasized that there’s still so much more to consider before landing on final remedies and that the DOJ reserves “the right to add or remove potential proposed remedies.”
That means that while the DOJ has said that requiring a divestment of Chrome or Android isn’t completely off the table, they currently aren’t committed to following through on ordering a breakup.
Through the remedies phase of litigation, the DOJ expects that discovery will reveal more about whether requiring a breakup is needed or if other remedies might resolve antitrust concerns while preserving Google’s search empire.
One reason it might be necessary to spin off Chrome or Android, however, would be to “prevent Google from using products such as Chrome, Play, and Android to advantage Google search and Google search-related products and features—including emerging search access points and features, such as artificial intelligence—over rivals or new entrants,” the DOJ said.
Google has warned that a breakup could hurt small businesses that depend on open source code Google develops for Android and Chrome. Costs of Android devices could also rise, Google warned.
Adam Epstein—the president and co-CEO of adMarketplace, which bills itself as “the largest consumer search technology company outside of Google and Bing”—told Ars last September that spinning out Android and Chrome may inflict “maximum pain” on Google. But it could also “cause pain to users and publishers and might not be the best way to create competition in search results and advertising.”
Buried in a story from The New York Times is perhaps the biggest clue that Trump may again be warming to Google as he likely heads back to Washington. The Times noted that at the Chicago event, Trump seemed to be echoing a Google talking point.
Google has argued that “a breakup could hurt America’s interests in a heated geopolitical competition with China over dominance in areas like artificial intelligence,” The Times reported. And Trump appeared to be running with that same logic when seemingly shifting his position on wanting to destroy Google in his final days on the campaign trail.
“It’s a very dangerous thing, because we want to have great companies,” Trump said. “We don’t want China to have these companies.”
Ashley is a senior policy reporter for Ars Technica, dedicated to tracking social impacts of emerging policies and new technologies. She is a Chicago-based journalist with 20 years of experience.
On Monday, Microsoft came out guns blazing, posting a blog accusing Google of “dishonestly” funding groups conducting allegedly biased studies to discredit Microsoft and mislead antitrust enforcers and the public.
In the blog, Microsoft lawyer Rima Alaily alleged that an astroturf group called the Open Cloud Coalition will launch this week and will appear to be led by “a handful of European cloud providers.” In actuality, however, those smaller companies were secretly recruited by Google, which allegedly pays them “to serve as the public face” and “obfuscate” Google’s involvement, Microsoft’s blog said. In return, Google likely offered the cloud providers cash or discounts to join, Alaily alleged.
The Open Cloud Coalition is just one part of a “pattern of shadowy campaigns” that Google has funded, both “directly and indirectly,” to muddy the antitrust waters, Alaily alleged. The only other named example that Alaily gives while documenting this supposed pattern is the US-based Coalition for Fair Software Licensing (CFSL), which Alaily said has attacked Microsoft’s cloud computing business in the US, the United Kingdom, and the European Union.
That group is led by Ryan Triplette, who Alaily said is “a well-known lobbyist for Google in Washington, DC, but Google’s affiliation isn’t disclosed publicly by the organization.” An online search confirms Triplette was formerly a lobbyist for Franklin Square Group, which Politico reported represented Google during her time there.
Ars could not immediately reach the CFSL for comment. Google’s spokesperson told Ars that the company has “been a public supporter of CFSL for more than two years” and has “no idea what evidence Microsoft cites that we are the main funder of CFSL.” If Triplette was previously a lobbyist for Google, the spokesperson said, “that’s a weird criticism to make” since it’s likely “everybody in law, policy, etc.,” has “worked for Google, Microsoft, or Amazon at some point, in some capacity.”
Following an investigation, Elon Musk’s X has won its fight to avoid gatekeeper status under the European Union’s strict competition law, the Digital Markets Act (DMA).
On Wednesday, the European Commission (EC) announced that “X does indeed not qualify as a gatekeeper in relation to its online social networking service, given that the investigation revealed that X is not an important gateway for business users to reach end users.”
Since March, X had strongly opposed the gatekeeper designation by arguing that although X connects advertisers to more than 45 million monthly users, it does not have a “significant impact” on the EU’s internal market, a case filing showed.
A gatekeeper “is presumed to have a significant impact on the internal market where it achieves an annual Union turnover equal to or above EUR 7.5 billion in each of the last three financial years,” the case filing said. But X submitted evidence showing that its Union turnover was less than that in 2022, the same year that Musk took over Twitter and began alienating advertisers by posting their ads next to extremists’ tweets.
Throughout Musk’s reign at Twitter/X, the social networking company told the EC, both advertising revenue and users have steadily declined in the EU. In particular, “X Ads has a too small and decreasing scale in terms of share of advertising spend in the Union to constitute an important gateway in the market for online advertising,” X argued, further noting that X had a “lack of platform power” to change that anytime soon.
“In the last 15 months, X Ads has faced a decline in number of advertising business users, as well as a decline in pricing,” X argued.
Google called the DOJ extending search remedies to AI “radical,” an “overreach.”
The US Department of Justice finally proposed sweeping remedies to destroy Google’s search monopoly late yesterday, and, predictably, Google is not loving any of it.
On top of predictable asks—like potentially requiring Google to share search data with rivals, restricting distribution agreements with browsers like Firefox and device makers like Apple, and breaking off Chrome or Android—the DOJ proposed remedies to keep Google from blocking competition in “the evolving search industry.” And those extra steps threaten Google’s stake in the nascent AI search world.
This is only the first step in the remedies stage of litigation, but Google is already showing resistance to both expected and unexpected remedies that the DOJ proposed. In a blog from Google’s vice president of regulatory affairs, Lee-Anne Mulholland, the company accused the DOJ of “overreach,” suggesting that proposed remedies are “radical” and “go far beyond the specific legal issues in this case.”
From here, discovery will proceed as the DOJ makes a case to broaden the scope of proposed remedies and Google raises its defense to keep remedies as narrowly tailored as possible. After that phase concludes, the DOJ will propose its final judgement on remedies in November, which must be fully revised by March 2025 for the court to then order remedies.
Even then, however, the trial is unlikely to conclude, as Google plans to appeal. In August, Mozilla’s spokesperson told Ars that the trial could drag on for years before any remedies are put in place.
In the meantime, Google plans to continue focusing on building out its search empire, Google’s president of global affairs, Kent Walker, said in August. This presumably includes innovations in AI search that the DOJ fears may further entrench Google’s dominant position.
Scrutiny of Google’s every move in the AI industry will likely only be heightened in that period. As Google has already begun seeking exclusive AI deals with companies like Apple, it risks appearing to engage in the same kinds of anti-competitive behavior in AI markets as the court has already condemned. And giving that impression could not only impact remedies ordered by the court, but also potentially weaken Google’s chances of winning on appeal, Lee Hepner, an antitrust attorney monitoring the trial for the American Economic Liberties Project, told Ars.
Ending Google’s monopoly starts with default deals
In the DOJ’s proposed remedy framework, the DOJ says that there’s still so much more to consider before landing on final remedies that it reserves “the right to add or remove potential proposed remedies.”
Through discovery, DOJ said that it plans to continue engaging experts and stakeholders “to learn not just about the relevant markets themselves but also about adjacent markets as well as remedies from other jurisdictions that could affect or inform the optimal remedies in this action.
“To be effective, these remedies… must include some degree of flexibility because market developments are not always easy to predict and the mechanisms and incentives for circumvention are endless,” the DOJ said.
Ultimately, the DOJ said that any remedies sought should be “mutually reinforcing” and work to “unfetter” Google’s current monopoly in general search services and general text advertising markets. That effort would include removing barriers to competition—like distribution and revenue-sharing agreements—as well as denying Google monopoly profits and preventing Google from monopolizing “related markets in the future,” the DOJ said.
Any effort to undo Google’s monopoly starts with ending Google’s control over “the most popular distribution channels,” the DOJ said. At one point during the trial, for example, a witness accidentally blurted out that Apple gets a 36 percent cut from its Safari deal with Google. Lucrative default deals like that leave rivals with “little-to-no incentive to compete for users,” the DOJ said.
“Fully remedying these harms requires not only ending Google’s control of distribution today, but also ensuring Google cannot control the distribution of tomorrow,” the DOJ warned.
To dislodge this key peg propping up Google’s search monopoly, some options include ending Google’s default deals altogether, which would “limit or prohibit default agreements, preinstallation agreements, and other revenue-sharing arrangements related to search and search-related products, potentially with or without the use of a choice screen.”
A breakup could be necessary
Behavior and structural remedies may also be needed, the DOJ proposed, to “prevent Google from using products such as Chrome, Play, and Android to advantage Google search and Google search-related products and features—including emerging search access points and features, such as artificial intelligence—over rivals or new entrants.” That could mean spinning off the Chrome browser or restricting Google from preinstalling its search engine as the default in Chrome or on Android devices.
In her blog, Mulholland conceded that “this case is about a set of search distribution contracts” but claimed that “overbroad restrictions on distribution contracts” would create friction for Google users and “reduce revenue for companies like Mozilla” as well as Android smart phone makers.
Asked to comment on supposedly feared revenue losses, a Mozilla spokesperson told Ars, “[We are] closely monitoring the legal process and considering its potential impact on Mozilla and how we can positively influence the next steps. Mozilla has always championed competition and choice online, particularly in search. Firefox continues to offer a range of search options, and we remain committed to serving our users’ preferences while fostering a competitive market.”
Mulholland also warned that “splitting off” Chrome or Android from Google’s search business “would break them” and potentially “raise the cost of devices,” because “few companies would have the ability or incentive to keep them open source, or to invest in them at the same level we do.”
“We’ve invested billions of dollars in Chrome and Android,” Mulholland wrote. “Chrome is a secure, fast, and free browser and its open-source code provides the backbone for numerous competing browsers. Android is a secure, innovative, and free open-source operating system that has enabled vast choice in the smartphone market, helping to keep the cost of phones low for billions of people.”
Google has long argued that its investment in open source Chrome and Android projects benefits developers whose businesses and customers would be harmed if those efforts lost critical funding.
“Features like Chrome’s Safe Browsing, Android’s security features, and Play Protect benefit from information and signals from a range of Google products and our threat-detection expertise,” Mulholland wrote. “Severing Chrome and Android would jeopardize security and make patching security bugs harder.”
Hepner told Ars that Android could potentially thrive if broken off from Google, suggesting that through discovery, it will become clearer what would happen if either Google product was severed from the company.
“I think others would agree that Android is a company that is capable [being] a standalone entity,” Hepner said. “It could be independently monetized through relationships with device manufacturers, web browsers, alternative Play Stores that are not under Google’s umbrella. And that if that were the case, what you would see is that Android and the operating system marketplace begins to evolve to meet the needs and demands of innovative products that are not being created just by Google. And you’ll see that dictating the evolution of the marketplace and fundamentally the flow of information across our society.”
Mulholland also claimed that sharing search data with rivals risked exposing users to privacy and security risks, but the DOJ vowed to be “mindful of potential user privacy concerns in the context of data sharing” while distinguishing “genuine privacy concerns” from “pretextual arguments” potentially misleading the court regarding alleged risks.
One possible way around privacy concerns, the DOJ suggested, would be prohibiting Google from collecting the kind of sensitive data that cannot be shared with rivals.
Finally, to stop Google from charging supra-competitive prices for ads, the DOJ is “evaluating remedies” like licensing or syndicating Google’s ad feed “independent of its search results.” Further, the DOJ may require more transparency, forcing Google to provide detailed “search query reports” featuring currently obscured “information related to its search text ads auction and ad monetization.”
Stakeholders were divided on whether the DOJ’s initial framework is appropriate.
Matt Schruers, the CEO of a trade association called the Computer & Communications Industry Association (which represents Big Tech companies like Google), criticized the DOJ’s “hodgepodge of structural and behavioral remedies” as going “far beyond” what’s needed to address harms.
“Any remedy should be narrowly tailored to address specific conduct, which in this case was a set of search distribution contracts,” Schruers said. “Instead, the proposed DOJ remedies would reshape numerous industries and products, which would harm consumers and innovation in these dynamic markets.”
But a senior vice president of public affairs for Google search rival DuckDuckGo, Kamyl Bazbaz, praised the DOJ’s framework as being “anchored to the court’s ruling” and appropriately broad.
“This proposal smartly takes aim at breaking Google’s illegal hold on the general search market now and ushers in a new era of enduring competition moving forward,” Bazbaz said. “The framework understands that no single remedy can undo Google’s illegal monopoly, it will require a range of behavioral and structural remedies to free the market.”
Bazbaz expects that “Google is going to use every resource at its disposal to discredit this proposal,” suggesting that “should be taken as a sign this framework can create real competition.”
AI deals could weaken Google’s appeal, expert says
Google appears particularly disturbed by the DOJ’s insistence that remedies must be forward-looking and prevent Google from leveraging its existing monopoly power “to feed artificial intelligence features.”
As Google sees it, the DOJ’s attempt to attack Google’s AI business “comes at a time when competition in how people find information is blooming, with all sorts of new entrants emerging and new technologies like AI transforming the industry.”
But the DOJ has warned that Google’s search monopoly potentially feeding AI features “is an emerging barrier to competition and risks further entrenching Google’s dominance.”
The DOJ has apparently been weighing some of the biggest complaints about Google’s AI training when mulling remedies. That includes listening to frustrated site owners who can’t afford to block Google from scraping data for AI training because the same exact crawler indexes their content in Google search results. Those site owners have “little choice” but to allow AI training or else sacrifice traffic from Google search, The Seattle Times reported.
Remedy options may come with consequences
Remedies in the search trial might change that. In their proposal, the DOJ said it’s considering remedies that would “prohibit Google from using contracts or other practices to undermine rivals’ access to web content and level the playing field by requiring Google to allow websites crawled for Google search to opt out of training or appearing in any Google-owned artificial-intelligence product or feature on Google search,” such as Google’s controversial AI summaries.
Hepner told Ars that “it’s not surprising at all” that remedies cover both search and AI because “at the core of Google’s monopoly power is its enormous scale and access to data.”
“The Justice Department is clearly thinking creatively,” Hepner said, noting that “the ability for content creators to opt out of having their material and work product used to train Google’s AI systems is an interesting approach to depriving Google of its immense scale.”
The DOJ is also eyeing controls on Google’s use of scale to power AI advertising technologies like Performance Max to end Google’s supracompetitive pricing on text ads for good.
It’s critical to think about the future, the DOJ argued in its framework, because “Google’s anticompetitive conduct resulted in interlocking and pernicious harms that present unprecedented complexities in a highly evolving set of markets”—not just in the markets where Google holds monopoly powers.
Google disagrees with this alleged “government overreach.”
“Hampering Google’s AI tools risks holding back American innovation at a critical moment,” Mulholland warned, claiming that AI is still new and “competition globally is fierce.”
“There are enormous risks to the government putting its thumb on the scale of this vital industry—skewing investment, distorting incentives, hobbling emerging business models—all at precisely the moment that we need to encourage investment, new business models, and American technological leadership,” Mulholland wrote.
Hepner told Ars that he thinks that the DOJ’s proposed remedies framework actually “meets the moment and matches the imperative to deprive Google of its monopoly hold on the search market, on search advertising, and potentially on future related markets.”
To ensure compliance with any remedies pursued, the DOJ also recommended “protections against circumvention and retaliation, including through novel paths to preserving dominance in the monopolized markets.”
That means Google might be required to “finance and report to a Court-appointed technical committee” charged with monitoring any Google missteps. The company may also have to agree to retain more records for longer—including chat messages that the company has been heavily criticized for deleting. And through this compliance monitoring, Google may also be prohibited from owning a large stake in any rivals.
If Google were ever found willfully non-compliant, the DOJ is considering a “range of provisions,” including risking more extreme structural or behavioral remedies or enduring extensions of compliance periods.
As the remedies stage continues through the spring, followed by Google’s prompt appeal, Hepner suggested that the DOJ could fight to start imposing remedies before the appeal concludes. Likely Google would just as strongly fight for any remedies to be delayed.
While the trial drags on, Hepner noted that Google already appears to be trying to strike another default deal with Apple that appears pretty similar to the controversial distribution deals at the heart of the search monopoly trial. In March, Apple started mulling using Google’s Gemini to exclusively power new AI features for the iPhone.
“This is basically the exact same anticompetitive behavior that they were found liable for,” Hepner told Ars, suggesting this could “weaken” Apple’s defense both against the DOJ’s broad framework of proposed remedies and during the appeal.
“If Google is actually engaging in the same anti-competitive conduct and artificial intelligence markets that they were found liable for in the search market, the court’s not going to look kindly on that relative to an appeal,” Hepner said.
Ashley is a senior policy reporter for Ars Technica, dedicated to tracking social impacts of emerging policies and new technologies. She is a Chicago-based journalist with 20 years of experience.
Google wound down its defense in the US Department of Justice’s ad tech monopoly trial this week, following a week of testimony from witnesses that experts said seemed to lack credibility.
The tech giant started its defense by showing a widely mocked chart that Google executive Scott Sheffer called a “spaghetti football,” supposedly showing a fluid industry thriving thanks to Google’s ad tech platform but mostly just “confusing” everyone and possibly even helping to debunk its case, Open Markets Institute policy analyst Karina Montoya reported.
“The effect of this image might have backfired as it also made it evident that Google is ubiquitous in digital advertising,” Montoya reported. “During DOJ’s cross-examination, the spaghetti football was untangled to show only the ad tech products used specifically by publishers and advertisers on the open web.”
One witness, Marco Hardie, Google’s current head of industry, was even removed from the stand, his testimony deemed irrelevant by US District Judge Leonie Brinkema, Big Tech On Trial reported. Another, Google executive Scott Sheffer, gave testimony Brinkema considered “tainted,” Montoya reported. But perhaps the most heated exchange about a witness’ credibility came during the DOJ’s cross-examination of Mark Israel, the key expert that Google is relying on to challenge the DOJ’s market definition.
Google’s case depends largely on Brinkema agreeing that the DOJ’s market definition is too narrow, with an allegedly outdated focus on display ads on the open web, as opposed to a broader market including display ads appearing in apps or on social media. But experts monitoring the trial suggested that Brinkema may end up questioning Israel’s credibility after DOJ lawyer Aaron Teitelbaum’s aggressive cross-examination.
According to Big Tech on Trial, which posted the exchange on X (formerly Twitter), Teitelbaum’s line of questioning came across as a “striking and effective impeachment of Mark Israel’s credibility as a witness.”
During his testimony, Israel told Brinkema that Google’s share of the US display ads market is only 25 percent, minimizing Google’s alleged dominance while emphasizing that Google faced “intense competition” from other Big Tech companies like Amazon, Meta, and TikTok in this broader market, Open Markets Institute policy analyst Karina Montoya reported.
On cross-examination, Teitelbaum called Israel out as a “serial ‘expert’ for companies facing antitrust challenges” who “always finds that the companies ‘explained away’ market definition,” Big Tech on Trial posted on X. Teitelbaum even read out quotes from past cases “in which judges described” Israel’s “expert testimony as ‘not credible’ and having ‘misunderstood antitrust law.'”
Israel was also accused by past judges of rendering his opinions “based on false assumptions,” according to USvGoogleAds, a site run by the digital advertising watchdog Check My Ads with ad industry partners. And specifically for the Google ad tech case, Teitelbaum noted that Israel omitted ad spend data to seemingly manipulate one of his charts.
“Not a good look,” the watchdog’s site opined.
Perhaps most damaging, Teitelbaum asked Israel to confirm that “80 percent of his income comes from doing this sort of expert testimony,” suggesting that Israel seemingly depended on being paid by companies like Jet Blue and Kroger-Albertsons—and even previously by Google during the search monopoly trial—to muddy the waters on market definition. Lee Hepner, an antitrust lawyer with the American Economic Liberties Project, posted on X that the DOJ’s antitrust chief, Jonathan Kanter, has grown wary of serial experts supposedly sowing distrust in the court system.
“Let me say this clearly—this will not end well,” Kanter said during a speech at a competition law conference this month. “Already we see a seeping distrust of expertise by the courts and by law enforcers.”
“Best witnesses money can buy”
In addition to experts and Google staffers backing up Google’s proposed findings of fact and conclusions of law, Google brought in Courtney Caldwell—the CEO of a small business that once received a grant from Google and appears in Google’s marketing materials—to back up claims that a DOJ win could harm small businesses, Big Tech on Trial reported.
Google’s direct examination of Caldwell was “basically just a Google ad,” Big Tech on Trial said, while Check My Ads’ site suggested that Google mostly just called upon “the best witnesses their money can buy, and it still did not get them very far.”
According to Big Tech on Trial, Google is using a “light touch” in its defense, refusing to go “pound for pound” to refute the DOJ’s case. Using this approach, Google can seemingly ignore any argument the DOJ raises that doesn’t fit into the picture Google wants Brinkema to accept of Google’s ad empire growing organically, rather than anti-competitively constructed with the intent to shut out rivals through mergers and acquisitions.
Where the DOJ wants the judge to see “a Google-only pipeline through the heart of the ad tech stack, denying non-Google rivals the same access,” Google argues that it has only “designed a set of products that work efficiently with each other and attract a valuable customer base.”
Evidence that Brinkeman might find hard to ignore include a 2008 statement from Google’s former president of display advertising, David Rosenblatt, confirming that it would “take an act of god” to get people to switch ad platforms because of extremely high switching costs. Rosenblatt also suggested in a 2009 presentation that Google acquiring DoubleClick for Publishers would make Google’s ad tech like the New York Stock Exchange, putting Google in a position to monitor every ad sale and doing for display ads “what Google did to search.” There’s also a 2010 email where now-YouTube CEO Neal Mohan recommended getting Google ahead in the display ad market by “parking” a rival with “the most traction.”
On Friday, testimony concluded abruptly after the DOJ only called one rebuttal witness, Big Tech on Trial posted on X. Brinkema is expected to hear closing arguments on November 25, Big Tech on Trial reported, and rule in December, Montoya reported.
