WASHINGTON — Today, Diana Moss, Vice President and Director of Competition Policy at the Progressive Policy Institute (PPI), issued the following statement regarding the U.S. Department of Justice’s (DOJ) proposed remedies framework in the case U.S. v. Google (2020):
“Even before a decision is made to file a case, public antitrust enforcers pragmatically have their eye on the ‘end-game.’ That is, if the government wins its case, what remedies are needed to restore the competition lost by consolidation or business practices that stifle competition and hurt consumers? The U.S. Department of Justice (DOJ) case against Google in online search markets is the first modern monopoly case to take on this important question. It follows a federal district court opinion finding that Google holds monopoly power and illegally maintained that power in two online search markets.
“Yesterday, the DOJ issued its proposal for a framework of possible remedies to restore competition in online search markets. The wide-ranging document includes remedies that are responsive to Judge Mehta’s ruling that Google has too much market power in online search. These include a ban on paying some equipment manufacturers to make the Google search engine the exclusive default on smart phones and web browsers.
“But some of the remedies on DOJ’s list appear to go beyond the scope of the court’s findings, with broad impact on Google’s business model, value proposition, and complex engineering-economic machinery. For example, it covers structural remedies, such as the spin-off of Google’s Chrome browser. It is no secret that the administration’s antitrust enforcers have been searching for ways to break up America’s big tech firms. It is unclear at this time, however, if such a remedy is either necessary or appropriate to resolve the specific issues that Judge Metha identified.
“Breakup remedies may not be effective, either, because they have not been tested in complex digital ecosystems. If remedies failed in a grocery store merger like Safeway-Albertsons, then only imagine the challenges in a complex digital ecosystem. As always, consumers will ultimately bear the burden of a failed remedy, emphasizing the great care necessary to connect it to specific competitive harms.
“Perhaps most important, DOJ’s filing includes extensive behavioral conditions, or restrictions on business operations. Unlike its monopolization case, which is grounded in facts, the DOJ’s fixes are unfettered by the constraints of evidence and experience. Behavioral remedies are well-known to be ineffective, as is clear from years of violations following the Live Nation-Ticketmaster merger.
“Other behavioral remedies suggested by the DOJ seem hubristically divorced from their potential adverse impact on user privacy or online security. They also involve sharing of data and APIs that could transform search into an essentially open source, open access platform. Such remedies, which amount to de facto regulation, are likely to impact innovation — potentially disrupting the incentives to innovate that anti-monopoly law is designed to promote.
“The U.S. v. Google case is at a critical stage. The DOJ will propose more detailed remedies in November 2024. These remedies could well set the mark in other, pending digital monopolization cases. This makes it even more important to avoid a ‘kitchen sink’ approach to proposed remedies and instead bear down on the most effective fixes for restoring specific competitive concerns.”
The Progressive Policy Institute (PPI) is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Learn more about PPI by visiting progressivepolicy.org. Find an expert at PPI and follow us on Twitter.
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Media Contact: Ian O’Keefe, iokeefe@ppionline.org
