Tech giant Microsoft Corp. is urging the US Department of Justice (DoJ) to take action against Alphabet’s Google for its alleged anti-competitive practices in the internet search market. Microsoft CEO Satya Nadella recently testified during Google’s antitrust trial in Washington, stating that the idea that users have a choice to switch search engine defaults is invalid.
The DoJ and attorneys general from 38 US states have accused Google of monopolistic behavior to maintain its dominant position in the search market. They claim that Google pays billions of dollars annually to smartphone manufacturers, rival web browsers, and mobile network operators to ensure its search engine remains as the default option. Google, on the other hand, denies these allegations, but Nadella argues that their 91.6% global market share makes it extremely challenging for competitors to enter the market.
Google’s defense revolves around the claim that it has made it easier for users to change search engine defaults on smartphones and computers. However, Nadella points out that Microsoft’s attempts to make its Bing search engine the default on Apple devices have been unsuccessful. Despite offering better terms than Google and being willing to lose billions of dollars, Microsoft’s Bing only controls 3% of the global search engine traffic.
Microsoft is disappointed with the failed deal with Apple earlier this year. The company offered better terms than Google in an attempt to make Bing the default search engine, but Apple chose to sign a $15 billion deal with Google instead, with the potential to increase to $19 billion by the end of the year. Previous attempts to sell Bing to Apple also did not materialize.
End of truce, resumption of war
Since 2021, Google and Microsoft have been engaged in a fierce market battle after ending their non-aggression pact, where they agreed not to target each other’s businesses with lobbying efforts. Microsoft has been advocating for equal access to search engines, while Google sees these efforts as a reflection of Microsoft’s perception of Google as a threat. The rivalry between the two companies has attracted regulatory scrutiny from antitrust agencies, and the final decision on the current case is expected next year.
Although Microsoft hopes to see Google penalized in the trial, its recent $10 billion investment in OpenAI’s ChatGPT and the integration of that chatbot with Bing are unlikely to dethrone Google as the world’s most popular search engine.
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