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A bipartisan collection of 50 attorneys general from states and U.S. territories united Monday in Washington to announce an investigation into Google, exploring whether the internet search giant violated state and federal antitrust laws as it moved to dominate the online advertising market.
It is the second Big Tech company to face an antitrust investigation this month. Another group of states is looking into Facebook’s practices.
The group of top legal cops said they will review Google’s advertising markets and search capabilities to determine whether business practices have led to anti-competitive behavior, harmed consumers and drove rivals out of business.
They said some Google search queries have yielded responses to businesses or advertisers who pay for their links to show up in specific positions.
“As a new mom, when my daughter is sick and I search online for advice or doctors, I want the best advice from the best doctors — not the doctor, not the clinic who can spend the most on advertising,” said Arkansas Attorney General Leslie Rutledge. “Most Americans think it’s free to ‘Google‘ something, but it comes at a cost.”
European countries already are investigating the market power of Google, Facebook and other U.S.-based tech giants. In this decade alone, the European Union has launched three antitrust cases against Google and levied over $8.1 billion in fines against two of the company’s services: Google Shopping and Android.
The pressure has been building in the U.S. on tech companies as well. Reuters has reported that the Federal Trade Commission is looking into antitrust allegations against Apple, Amazon and Facebook in addition to Google. Facebook was hit by a state investigation, led by New York’s attorney general, this month over its dominance of social media.
The red and blue states came together Monday for the latest legal offensive, telling reporters at the Supreme Court that small businesses could be locked out by the monopolistic powers of Google’s dominance. Though they are not filing a lawsuit against the company just yet, they have vowed to follow the facts where they lead and communicate weekly about where the investigation stands.
“There is nothing wrong with a business becoming the biggest game in town if it does so through free market competition, but we have seen evidence that Google’s business practices may have undermined consumer choice, stifled innovation, violated users’ privacy and put Google in control of the flow and dissemination of online information. We intend to closely follow the facts we discover in this case and proceed as necessary,” said Texas Attorney General Ken Paxton, who is leading the coalition.
“While many consumers believe the internet is free … the internet is not free. This is a company that dominates all aspects of advertising on the internet and searching on the internet,” Mr. Paxton said at the press briefing.
In anticipation of the investigation, Kent Walker, Google’s senior vice president of global affairs, said the company has received a Justice Department request for information pertaining to the investigations.
“We have always worked constructively with regulators and we will continue to do so. We look forward to showing how we are investing in innovation, providing services that people want, and engaging in robust and fair competition,” he said in a blog post Friday.
California, where Google has headquarters, did not join the other states in their effort. Neither did Alabama, but attorneys general from the District of Columbia and Puerto Rico are involved, making up the 50 states and territories driving the investigation.
The attorneys general said that more than 90% of Google’s revenue comes from digital advertising, while the prime source of revenue for traditional advertisers, including newspapers and magazines, has dried up.
“Google’s dominance now allows them to pick winners and losers in this exchange,” said Louisiana Attorney General Jeff Landry.
Kevin Clarkson, attorney general of Alaska, said this issue is critically important for business in his state because of its geography. He noted that many Alaskan businesses rely on the internet to reach customers across the country.
The initiative, using resources from 50 state prosecutors’ offices, brings increased pressure, the group argues, especially given the political divisions they may have on other issues.
“This is an unusual setting right here,” said Karl Racine, the attorney general for the District of Columbia. “I’m next to friends of mine I vehemently disagree with on issues like immigration, reproductive rights, gun rights and other issues.
“We are acting as one today,” he added.
The bipartisan effort was organized after reports in June that the Justice Department was preparing its own antitrust investigation into Google.
John E. Lopatka, a law professor at Pennsylvania State University, said the states’ investigation is likely to prove duplicative because the Justice Department usually has the expertise on antitrust law, a complex legal issue.
“Google, as well as the other Big Tech companies, are highly politically unpopular now. This is political red meat,” he told The Washington Times.
Mr. Lopatka said the states could try to push for quicker action than the Justice Department might be willing to accept if they find a suspected violation and file suit.
“I think the Justice Department would be more careful,” he said.
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