Is the Google antitrust ruling a ‘big whiff,’ or an advantage for rivals like Microsoft?

In a closely watched antitrust case, a federal judge ruled this week that Google has to share search results and some data with rival companies. But the judge ruled Google does not have to sell off Chrome, its ubiquitous web browser. What could this ruling mean for our homegrown tech behemoth Microsoft, and other search engine rivals of Google?

GeekWire co-founder Todd Bishop looked into that and other questions in a new piece. He told KUOW’s Kim Malcolm what he found.

This interview has been edited for clarity.

Kim Malcolm: This case was brought by Washington state, a coalition of other states, and the Justice Department back in 2020. What are the key elements that we need to know about this week's ruling?

Todd Bishop: The claimants argued that Google illegally maintained its monopoly in search by paying billions to make itself the default search engine on iPhones, Android phones, and browsers like Safari. In the key ruling, the judge, Amit Mehta, agreed. He said that these exclusive contracts effectively froze the search ecosystem in place.

The remedies that he put out in this ruling included prohibiting Google from doing exclusive deals anymore. Google can still, for example, strike a deal with Apple to have Google be the default search engine, the thing that everybody uses, unless they change their settings on iPhones in Safari. But it cannot allow them to basically have an exclusive deal. Google cannot say to Apple, 'OK, and you must never do a deal with Microsoft, either.' So that was one key element of the ruling.

Already, there are plenty of critics out there who say the judge didn't go far enough. I was interested in your writing that indicated there's a possible advantage here for Microsoft, but maybe not a big one. Can you talk a little bit about what you mean by that?

Yes, another of the remedies that the judge came up with is that Google has to share some data with rivals on commercially acceptable terms, and syndicate search results in the same way. For example, Microsoft could use Google’s search results, Google's underlying search algorithms and all of the secret sauce that Google has that makes it so powerful, to power Bing in this way, at least for up to five years, on kind of a de-escalating basis. In other words, it would sort of trail off over those five years, Microsoft would be able to get this advantage of this scale that Google has.

This is something that came up in the trial. Microsoft CEO Satya Nadella testified at the trial. He talked about the ubiquity of Google. His quote was something like, 'You wake up in the morning, you brush your teeth, and you search Google.' He talked about the sort of vicious cycle that it creates for competitors like Microsoft, because they can't get the volume of traffic that will give them the data that they need to make their own products better.

In the meantime, Google has this exclusive lock on things like the Apple iPhone, and it's just very difficult for Microsoft to crack the case and get into that kind of market. And so, this way of sharing this information that the judge has opened the door to, could be potentially a way for Microsoft to start to get a leg up in that way.

If we step back and look at the big picture, antitrust cases are a tool to break up monopolies, to promote healthy competition in a marketplace. So where would you say this case stands as an example of monopoly-busting in the United States?

Pretty weak. Certainly, this does not compare to Judge Jackson's original breakup ruling for Microsoft in its landmark antitrust case back in the day involving Windows. He really, as you said earlier, stopped short of any kind of structural remedies like spinning off Chrome or banning Google's default payments entirely. I mean, Google can still spend billions to be the default on the iPhone, as long as it's not exclusive. It's a little more cautious, it's more incremental. It's designed to open up the distribution and really give rivals a fighting chance.

And to your point, there are tons of critics out there. They call it a missed opportunity, a big whiff, because Google basically gets to keep its biggest weapon: the ability to pay these enormous sums to basically cement its dominance.

There is some irony here, as you point out in your piece. As you said, Microsoft faced its own antitrust lawsuit about 20 years ago about bundling a web browser with its operating systems. I mean, how should we think about that now, given where we are as we move forward into this brave new world?

It's really interesting because, of course, Microsoft is, in many ways, portraying itself as the victim here in this case. And the main precedent that the judge leaned on in this ruling was from Microsoft's own antitrust case. In that case, Judge Thomas Penfield Jackson, after he ordered that breakup, it went through the appeals and in fact, the appeals court reversed that ruling and basically sent it back. And after that, Microsoft was able to reach a settlement. But the fact that there were not ultimately these structural remedies, in other words, this breakup of Microsoft into an operating systems and an application company, as the judge wanted to do back then, it set this precedent that the judge in this case was in many ways bound to go by. And so Microsoft dodging a bullet back in the day, helped Google dodge a bullet today.

Looking forward, what signs are you going to be searching for at Microsoft now as it responds to this ruling?

Microsoft hasn’t said what it plans to do in response to this ruling. It hasn’t said whether it will take advantage of the new data, of the new search results that could be offered to it. And it's a little bit of a prideful situation, I think, on Microsoft's part, because even as they have been complaining about this vicious cycle that Google is in, over the years, Microsoft has tried to get across, at least to the consumers, that it feels like its search results and the quality of the things that you get back when you type queries into Bing are as good as you would get from Google. That could be marketing, and maybe not reality, but if Microsoft now goes and says, ‘Hey, absolutely, we want to be able to buy Google's results from Google,’ it kind of goes against that.

The one other thing, and it's a big one to keep in mind, is artificial intelligence, because search is just completely different these days. Google has largely shifted across the world to these kind of AI-driven search results, these summaries that come up from Gemini when you do a search, and obviously Microsoft is big into Copilot, and to a large extent, the search platform has become the jumping off point for the world of artificial intelligence.

In that way, it's not an idle question. This is not just history, like Windows might have been back in the day, or Internet Explorer might have been back in the day, in terms of Microsoft's antitrust case. This is a very real, very current question, and the question of whether Google can remain dominant in search will go a long way toward determining whether Google or Microsoft or Amazon or somebody else ends up being the dominant player ultimately in artificial intelligence.

Listen to the interview by clicking the play button above.