Google’s Next Antitrust Battle

Google heads to trial today in an antitrust case that could carry wider ramifications for Big Tech.Credit…Jason Henry for The New York Times

The Justice Department vs. Google

For months, investors have largely shrugged off the mounting regulatory threat hanging over Big Tech. That calm could be tested with the Justice Department set to lock horns with Google on Monday a landmark antitrust trial on its profit engine that could add to calls that the group be broken up.

The stakes are huge for Google and Big Tech. The government is going after the company over its $200 billion advertising business, which accounted for three-quarters of its revenue last year. Its 2023 lawsuit accused Google of “anti-competitive” behavior by acting as the industry’s key buyer and seller of digital ads.

Google has had a run of setbacks. Last December, a jury ruled that the company violated antitrust laws by extracting fees and limiting competition on its app store; and last month, a federal judge ruled that Google maintained an illegal monopoly in its highly profitable search business. Together, they are a huge challenge to its business model just as artificial intelligence propels rivals like Microsoft, and the new technology poses a potentially existential threat to search.

Tech investors are already on edge. Google shares are down more than 20 percent since hitting a record high in July. And worries about a slowing economy and whether huge investments in artificial intelligence will pay off have dented tech stocks. Last week, the Nasdaq Composite fell nearly 6 percent, its worst weekly performance since January 2022.

The new case is focused on Google Ad Manager. Critics have argued that the tool gives the company an unfair advantage in selling digital ads, as it locks online publishers and advertisers into a single platform, giving Google supply-demand insights from both.

The government, along with states including California, New York and Tennessee, argues that Google violating the Sherman Antitrust Act, a bedrock law at the heart of major competition cases for over a century.