Google monopoly trial kicks off, Canada public policy head steps down

Colin McKay, head of Canada public policy and government relations at Alphabet Inc.’s Google, has left the company, announcing his departure in a LinkedIn post on Wednesday. After working with the company for more than 12 years, McKay will be replaced by YouTube Canada’s head of government affairs and public policy Jeanette Patell. She will lead both policy teams on an interim basis, according to spokesperson Shay Purdy. Against the backdrop of the ongoing scuffle between Google and the federal government over the Online News Act, McKay’s withdrawal comes at a pivotal time for the company, which has been facing another challenge from the government across the border. Tuesday marked the beginning of what is scheduled to be a 10-week trial between the U.S. Department of Justice (DOJ) and Google. Supported by a coalition of states, the feds allege Google has illegally monopolized the online search market, abusing its power to stifle competition. Google is the most used search engine in the world. According to analytics from Similarweb Ltd., it holds almost 91 per cent of the world’s search market share. The DOJ claims it maintains this dominance through illegal deals with device manufacturers, wireless carriers, and browser developers to make Google the default search engine on their products. The search giant is believed to have spent tens of billions of dollars on these default search deals, which the DOJ says forecloses any meaningful competition from rivals. According to the New York Times, Google is estimated to have paid Apple Inc. up to $20 billion a year, $3 billion to Samsung, and $400 million to Mozilla Firefox, among others. “Steadily and over the years, Google has expanded and refined the tactics it uses to harm competition. Instead of simply producing a better service that keeps consumers and advertisers loyal, Google focuses on building an impenetrable moat to protect its kingdom,” argued 38 state attorney generals in a 2020 court filing. Google denies its deals are anticompetitive, saying they are just optional, standard marketing expenses. “We also pay device makers and carriers for additional promotion of services like Chrome and Search, similar to the way a supermarket might charge a cereal brand to promote its products at eye-level on a shelf or at the end of an aisle,” wrote president of global affairs Kent Walker in a blog post. “People don't use Google because they have to — they use it because they want to.” Questions about the role that default placement plays is a core part of this case, and in the first few days of the trial, the DOJ has made clear it believes Google is the preset default on most devices because it pressured companies into making it so, not because of its quality. During opening statements on Tuesday, DOJ lawyer Kenneth Dintzer pointed to emails between Google and Apple staff in 2007. The two companies were negotiating browser and search contract terms. In response to a proposal to allow users to choose their search default on Apple devices, Google said, “No default placement - no revenue share.” “This is a monopolist flexing,” said Dintzer. Antitrust cases usually aim to measure the public cost incurred as a result of the alleged monopoly. However, because this involves Google’s “free” search, the DOJ argues that Google’s hold on the market has come at the cost of less privacy and less innovation. It has also allowed the company to raise its prices for advertisers, who the feds say are forced to oblige because they have nowhere else to go. It has been 25 years since the U.S. has seen a tech antitrust trial of this scale. Back in 1998, the government sued Microsoft Corp. for monopolizing the web browser market with Internet Explorer by preventing computer manufacturers who used its Windows operating system from offering competing software. Since the case was first filed in Oct. 2020, Google has been hit with five more antitrust lawsuits from U.S. officials, including claims around its monopoly in the advertising technology market. This is the latest in what appears to be a global crackdown on Google and other tech giants in recent years. Canada passed the Online News Act and Online Streaming Act, with Bill C-27 and online safety legislation in the works; Australia has its News Media Bargaining Code; and, perhaps the toughest regulation so far, the E.U. put its Digital Markets Act into force last year. – Reporting by Phalen Tynes-MacDonald at pcreed@thewirereport.ca and editing by Jenna Cocullo at jcocullo@thewirereport.ca.

Google monopoly trial kicks off, Canada public policy head steps down

News | September 15, 2023

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