DoJ

google’s-search-antitrust-trial-is-wrapping-up—here’s-what-we-learned

Google’s search antitrust trial is wrapping up—here’s what we learned

AI, antitrust, DoJ, Google, search, Tech / /

Google and the DOJ have had their say; now it’s in the judge’s hands.

Last year, United States District Court Judge Amit Mehta ruled that Google violated antitrust law by illegally maintaining a monopoly in search. Now, Google and the Department of Justice (DOJ) have had their say in the remedy phase of the trial, which wraps up today. It will determine the consequences for Google’s actions, potentially changing the landscape for search as we rocket into the AI era, whether we like it or not.

The remedy trial featured over 20 witnesses, including representatives from some of the most important technology firms in the world. Their statements about the past, present, and future of search moved markets, but what does the testimony mean for Google?

Everybody wants Chrome

One of the DOJ’s proposed remedies is to force Google to divest Chrome and the open source Chromium project. Google has been adamant both in and out of the courtroom that it is the only company that can properly run Chrome. It says selling Chrome would negatively impact privacy and security because Google’s technology is deeply embedded in the browser. And regardless, Google Chrome would be too expensive for anyone to buy.

Unfortunately for Google, it may have underestimated the avarice of its rivals. The DOJ called witnesses from Perplexity, OpenAI, and Yahoo—all of them said their firms were interested in buying Chrome. Yahoo’s Brian Provost noted that the company is currently working on a browser that supports the company’s search efforts. Provost said that it would take 6–9 months just to get a working prototype, but buying Chrome would be much faster. He suggested Yahoo’s search share could rise from the low single digits to double digits almost immediately with Chrome.

Break up the company without touching the sides and getting shocked!

Credit: Aurich Lawson

Meanwhile, OpenAI is burning money on generative AI, but Nick Turley, product manager for ChatGPT, said the company was prepared to buy Chrome if the opportunity arises. Like Yahoo, OpenAI has explored designing its own browser, but acquiring Chrome would instantly give it 3.5 billion users. If OpenAI got its hands on Chrome, Turley predicted an “AI-first” experience.

On the surface, the DOJ’s proposal to force a Chrome sale seems like an odd remedy for a search monopoly. However, the testimony made the point rather well. Search and browsers are inextricably linked—putting a different search engine in the Chrome address bar could give the new owner a major boost.

Browser choice conundrum

Also at issue in the trial are the massive payments Google makes to companies like Apple and Mozilla for search placement, as well as restrictions on search and app pre-loads on Android phones. The government says these deals are anti-competitive because they lock rivals out of so many distribution mechanisms.

Google pays Apple and Mozilla billions of dollars per year to remain the default search engine in their browsers. Apple’s Eddie Cue admitted he’s been losing sleep worrying about the possibility of losing that revenue. Meanwhile, Mozilla CFO Eric Muhlheim explained that losing the Google deal could spell the end of Firefox. He testified that Mozilla would have to make deep cuts across the company, which could lead to a “downward spiral” that dooms the browser.

Google’s goal here is to show that forcing it to drop these deals could actually reduce consumer choice, which does nothing to level the playing field, as the DOJ hopes to do. Google’s preferred remedy is to simply have less exclusivity in its search deals across both browsers and phones.

The great Google spinoff

While Google certainly doesn’t want to lose Chrome, there may be a more fundamental threat to its business in the DOJ’s remedies. The DOJ argued that Google’s illegal monopoly has given it an insurmountable technology lead, but a collection of data remedies could address that. Under the DOJ proposal, Google would have to license some of its core search technology, including the search index and ranking algorithm.

Google CEO Sundar Pichai gave testimony at the trial and cited these data remedies as no better than a spinoff of Google search. Google’s previous statements have referred to this derisively as “white labeling” Google search. Pichai claimed these remedies could force Google to reevaluate the amount it spends on research going forward, slowing progress in search for it and all the theoretical licensees.

Currently, there is no official API for syndicating Google’s search results. There are scrapers that aim to offer that service, but that’s a gray area, to say the least. Google has even rejected lucrative deals to share its index. Turley noted in his testimony that OpenAI approached Google to license the index for ChatGPT, but Google decided the deal could harm its search dominance, which was more important than a short-term payday.

AI advances

Initially, the DOJ wanted to force Google to stop investing in AI firms, fearing its influence could reduce competition as it gained control or acquired these startups. The government has backed away from this remedy, but AI is still core to the search trial. That seemed to surprise Judge Mehta.

During Pichai’s testimony, Mehta remarked that the status of AI had shifted considerably since the liability phase of the trial in 2023. “The consistent testimony from the witnesses was that the integration of AI and search or the impact of AI on search was years away,” Mehta said. Things are very different now, Mehta noted, with multiple competitors to Google in AI search. This may actually help Google’s case.

AI search has exploded since the 2023 trial, with Google launching its AI-only search product in beta earlier this year.

AI search has exploded since the 2023 trial, with Google launching its AI-only search product in beta earlier this year.

Throughout the trial, Google has sought to paint search as a rapidly changing market where its lead is no longer guaranteed. Google’s legal team pointed to the meteoric rise of ChatGPT, which has become an alternative to traditional search for many people.

On the other hand, Google doesn’t want to look too meek and ineffectual in the age of AI. Apple’s Eddie Cue testified toward the end of the trial and claimed that rival traditional search providers like DuckDuckGo don’t pose a real threat to Google, but AI does. According to Cue, search volume in Safari was down for the first time in April, which he attributed to people using AI services instead. Google saw its stock price drop on the news, forcing it to issue a statement denying Cue’s assessment. It says searches in Safari and other products are still growing.

A waiting game

With the arguments made, Google’s team will have to sweat it out this summer while Mehta decides on remedies. A decision is expected in August of this year, but that won’t be the end of it. Google is still hoping to overturn the original verdict. After the remedies are decided, it’s going to appeal and ask for a pause on the implementation of remedies. So it could be a while before anything changes for Google.

In the midst of all that, Google is still pursuing an appeal of the Google Play case brought by Epic Games, as well as the ad tech case that it lost a few weeks ago. That remedy trial will begin in September.

Photo of Ryan Whitwam

Ryan Whitwam is a senior technology reporter at Ars Technica, covering the ways Google, AI, and mobile technology continue to change the world. Over his 20-year career, he’s written for Android Police, ExtremeTech, Wirecutter, NY Times, and more. He has reviewed more phones than most people will ever own. You can follow him on Bluesky, where you will see photos of his dozens of mechanical keyboards.

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Sundar Pichai says DOJ demands are a “de facto” spin-off of Google search

antitrust, DoJ, Google, Tech / /

The Department of Justice (DOJ) rested its case in Google’s search remedy trial earlier this week, giving Google a chance to push back on the government’s attempt to break up the search giant. Today is arguably Google’s best chance to make the case that it should not be harshly penalized in the ongoing search antitrust case, with CEO Sundar Pichai taking the stand.

Pichai attempted to explain why Google isn’t abusing its market position and why the DOJ’s proposed remedies are too extreme. The issue of Chrome divestment came up, but Google’s team also focused intensely on the potential effects of the DOJ’s data remedies, which could force Google to share its search index and technology with other firms.

A de facto spin-off

Pichai, who chose to stand while giving testimony, took issue with the government’s proposal to force Google to license search technology to other companies. The DOJ claims that Google’s status as a monopolist has resulted in it accumulating a huge volume of user data on search behavior. Plus, its significant technological lead means its index of the web is much more robust than competing services.

If the market is going to be rebalanced, the DOJ believes Google must be forced to license this data. Google has derisively referred to this as “white labeling” Google search.

According to Bloomberg, Pichai used even harsher language when discussing these remedies in court. He called this part of the government’s case “so far reaching, so extraordinary” that it would remake Google as a company and lead to numerous unintended consequences. To hear Pichai tell it, forcing Google to license this data for a nominal fee would be a “de facto divestiture of search.”

Giving other companies the option of using Google search index to map the web would make other products better, but Pichai claims they would essentially be able to reverse-engineer everything that makes Google’s platform special. And at that point, Google would need to reevaluate how it approaches innovation. Pichai suggests the data remedies could make it “unviable” for Google to invest in research and development as it has been for the past 20 years.

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tesla-is-under-a-federal-wire-fraud-probe-for-misleading-investors

Tesla is under a federal wire fraud probe for misleading investors

Cars, DoJ, SEC, Tesla / /
A Tesla Model X with Roger the inflatable autopilot (from the movie Airplane!) in the driver's seat

Aurich Lawson | Tesla | Airplane!

There’s more bad news for Tesla. On Monday, we learned that CEO Elon Musk is continuing to slash his way through the company payroll as Tesla went through a fourth round of layoffs in four weeks. Yesterday, we discovered exactly what questions the National Highway Traffic Safety Administration wants answered about the safety of Tesla’s Autopilot driver assist. And today, it emerged that the US Department of Justice is investigating whether or not Tesla committed securities or wire fraud by making misleading statements about Autopilot and its so-called “Full Self-Driving” (FSD) option.

Reuters reported that three people familiar with the matter told it about the investigation. One of the sources also told Reuters that the Securities and Exchange Commission is also investigating Tesla’s claims about its driver assists.

Not the first time

This isn’t the first time Tesla has been accused of securities fraud. In 2018, Musk agreed to a settlement with the SEC over his infamous “funding secured” tweet that sent the company’s share price skyrocketing despite the fact that there was never actually a possibility that he would take the company private. As a result, Musk was required to step down as chairman, and both Musk and Tesla were ordered to pay $20 million in penalties, to be distributed to investors who lost money after being misled by Musk.

(However, a federal jury in 2023 sided with the CEO in a class-action lawsuit brought by investors.)

In another case, several Tesla owners filed a class-action lawsuit against the car company about “grossly exaggerated” range claims, alleging fraud and false advertising. The judge in that case ruled that the customers could not sue Tesla as a class, telling them instead that they had to pursue their cases individually via arbitration. We learned last October that the DOJ was also investigating the matter.

(Authorities in South Korea fined Tesla $2.2 million in January 2023 for misleading customers about range.)

Federal prosecutors first became interested in “whether Tesla misled consumers, investors, and regulators by making unsupported claims about its driver assistance technology’s capabilities” in 2022. Critics have regularly pointed out that even the name “Autopilot” is misleading, and there have been multiple instances of Musk demonstrating the system on camera without keeping his hands on the steering wheel, despite other Tesla literature that states drivers must do so at all times.

The CEO has also regularly claimed that Tesla is far ahead of the rest of the industry in autonomous driving technology, issuing deadlines for full autonomy that, like most of Musk’s deadlines, have come and gone without delivering the product.

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us-government-agencies-demand-fixable-ice-cream-machines

US government agencies demand fixable ice cream machines

copyright, department of justice, DMCA, DoJ, federal trade commission, ftc, ice cream, kytch, Policy, repair, right to repair, Section 1201, taylor / /

I scream, you scream, we all scream for 1201(c)3 exemptions —

McFlurries are a notable part of petition for commercial and industrial repairs.

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Taylor ice cream machine, with churning spindle removed by hand.

Enlarge / Taylor’s C709 Soft Serve Freezer isn’t so much mechanically complicated as it is a software and diagnostic trap for anyone without authorized access.

Many devices have been made difficult or financially nonviable to repair, whether by design or because of a lack of parts, manuals, or specialty tools. Machines that make ice cream, however, seem to have a special place in the hearts of lawmakers. Those machines are often broken and locked down for only the most profitable repairs.

The Federal Trade Commission and the antitrust division of the Department of Justice have asked the US Copyright Office (PDF) to exempt “commercial soft serve machines” from the anti-circumvention rules of Section 1201 of the Digital Millennium Copyright Act (DMCA). The governing bodies also submitted proprietary diagnostic kits, programmable logic controllers, and enterprise IT devices for DMCA exemptions.

“In each case, an exemption would give users more choices for third-party and self-repair and would likely lead to cost savings and a better return on investment in commercial and industrial equipment,” the joint comment states. Those markets would also see greater competition in the repair market, and companies would be prevented from using DMCA laws to enforce monopolies on repair, according to the comment.

The joint comment builds upon a petition filed by repair vendor and advocate iFixit and interest group Public Knowledge, which advocated for broad reforms while keeping a relatable, ingestible example at its center. McDonald’s soft serve ice cream machines, which are famously frequently broken, are supplied by industrial vendor Taylor. Taylor’s C709 Soft Serve Freezer requires lengthy, finicky warm-up and cleaning cycles, produces obtuse error codes, and, perhaps not coincidentally, costs $350 per 15 minutes of service for a Taylor technician to fix. iFixit tore down such a machine, confirming the lengthy process between plugging in and soft serving.

After one company built a Raspberry Pi-powered device, the Kytch, that could provide better diagnostics and insights, Taylor moved to ban franchisees from installing the device, then offered up its own competing product. Kytch has sued Taylor for $900 million in a case that is still pending.

Beyond ice cream, the petitions to the Copyright Office would provide more broad exemptions for industrial and commercial repairs that require some kind of workaround, decryption, or other software tinkering. Going past technological protection measures (TPMs) was made illegal by the 1998 DMCA, which was put in place largely because of the concerns of media firms facing what they considered rampant piracy.

Every three years, the Copyright Office allows for petitions to exempt certain exceptions to DMCA violations (and renew prior exemptions). Repair advocates have won exemptions for farm equipment repair, video game consoles, cars, and certain medical gear. The exemption is often granted for device fixing if a repair person can work past its locks, but not for the distribution of tools that would make such a repair far easier. The esoteric nature of such “release valve” offerings has led groups like the EFF to push for the DMCA’s abolishment.

DMCA exemptions occur on a parallel track to state right-to-repair bills and broader federal action. President Biden issued an executive order that included a push for repair reforms. The FTC has issued studies that call out unnecessary repair restrictions and has taken action against firms like Harley-Davidson, Westinghouse, and grill maker Weber for tying warranties to an authorized repair service.

Disclosure: Kevin Purdy previously worked for iFixit. He has no financial ties to the company.

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DOJ quietly removed Russian malware from routers in US homes and businesses

Biz & IT, china, DDoS, department of justice, DoJ, Fancy Bear, fbi, routers, russia, Security, ubiquiti / /

Fancy Bear —

Feds once again fix up compromised retail routers under court order.

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Ethernet cable plugged into a router LAN port

Getty Images

More than 1,000 Ubiquiti routers in homes and small businesses were infected with malware used by Russian-backed agents to coordinate them into a botnet for crime and spy operations, according to the Justice Department.

That malware, which worked as a botnet for the Russian hacking group Fancy Bear, was removed in January 2024 under a secret court order as part of “Operation Dying Ember,” according to the FBI’s director. It affected routers running Ubiquiti’s EdgeOS, but only those that had not changed their default administrative password. Access to the routers allowed the hacking group to “conceal and otherwise enable a variety of crimes,” the DOJ claims, including spearphishing and credential harvesting in the US and abroad.

Unlike previous attacks by Fancy Bear—that the DOJ ties to GRU Military Unit 26165, which is also known as APT 28, Sofacy Group, and Sednit, among other monikers—the Ubiquiti intrusion relied on a known malware, Moobot. Once infected by “Non-GRU cybercriminals,” GRU agents installed “bespoke scripts and files” to connect and repurpose the devices, according to the DOJ.

The DOJ also used the Moobot malware to copy and delete the botnet files and data, according to the DOJ, and then changed the routers’ firewall rules to block remote management access. During the court-sanctioned intrusion, the DOJ “enabled temporary collection of non-content routing information” that would “expose GRU attempts to thwart the operation.” This did not “impact the routers’ normal functionality or collect legitimate user content information,” the DOJ claims.

“For the second time in two months, we’ve disrupted state-sponsored hackers from launching cyber-attacks behind the cover of compromised US routers,” said Deputy Attorney General Lisa Monaco in a press release.

The DOJ states it will notify affected customers to ask them to perform a factory reset, install the latest firmware, and change their default administrative password.

Christopher A. Wray, director of the FBI, expanded on the Fancy Bear operation and international hacking threats generally at the ongoing Munich Security Conference. Russia has recently targeted underwater cables and industrial control systems worldwide, Wray said, according to a New York Times report. And since its invasion of Ukraine, Russia has focused on the US energy sector, Wray said.

The past year has been an active time for attacks on routers and other network infrastructure. TP-Link routers were found infected in May 2023 with malware from a reportedly Chinese-backed group. In September, modified firmware in Cisco routers was discovered as part of a Chinese-backed intrusion into multinational companies, according to US and Japanese authorities. Malware said by the DOJ to be tied to the Chinese government was removed from SOHO routers by the FBI last month in similar fashion to the most recently revealed operation, targeting Cisco and Netgear devices that had mostly reached their end of life and were no longer receiving security patches.

In each case, the routers provided a highly valuable service to the groups; that service was secondary to whatever primary aims later attacks might have. By nesting inside the routers, hackers could send commands from their overseas locations but have the traffic appear to be coming from a far more safe-looking location inside the target country or even inside a company.

Similar inside-the-house access has been sought by international attackers through VPN products, as in the three different Ivanti vulnerabilities discovered recently.

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