An antitrust case against Google’s search engine could be coming soon. Here’s how it could turn out, and why an $8 billion-a-year deal with Apple could be on the line. (GOOGL)

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The US Department of Justice could bring an antitrust case against Google as soon as next week, according to the latest reports, but one that might be more specific than expected.

The New York Times reports that the Justice Department is preparing to file a case focused on Google’s dominance in search, which would be more narrow in scope than many anticipated.

It could also splinter the wider investigation into Google’s dominance; a parallel investigation led by state attorneys general is said to be interested in bringing a case that would focus on Google’s advertising business.

The Justice Department is meeting with the state attorneys general this week to discuss their case, and the Times reports it is possible that the final lawsuit could change with these discussions.

Based on reports so far, a search investigation from the Justice Department would likely focus on how Google has used its dominant position in search to point users towards its own products, such as YouTube, and promote its major advertisers.

“If the case is just on search, they’re going to have to show that Google has monopoly on it. It seems like they can probably do that,” said Sam Weinstein, a former Justice Department antitrust attorney.

Weinstein said it might be easier to show monopoly in search than ads, with Google gobbling up roughly 90% of the global search market. Meanwhile, Google shares more of the online advertising space with social media giants like Facebook.

However, antitrust lawyers said that quantifying the damage to competitors in a search case could prove tricky, while an ads case would mean regulators could point to pricing data to more easily prove a harm against competitors.

“An ads case would be, in some respects, a far more traditional antitrust claim: you have engaged in anticompetitive behavior and that has raised prices,” said Gary Reback, a veteran Silicon Valley antitrust lawyer who spearheaded the Microsoft antitrust case in the 90s.

“Of the two cases, I think that one [ads] is more down the middle of the goal lines or goal posts,” agreed Hal Singer, an economist who specializes in antitrust.

According to reports, state attorneys general, led by Texas Republican AG Ken Paxton, could follow the Justice Department with a case focused on Google’s behavior in digital advertising.

A Google spokesperson declined to comment, but pointed Business Insider to its competition website where it argues “Our products increase choice and expand competition.”

A lucrative deal with Apple could be in the firing line

Another area of interest in a case focused on search could be how Google has edged out search rivals such as Microsoft. According to the Times report, a DoJ case could focus on Google’s agreement with companies like Apple to keep its search engine as the default browser on their devices.

Bernstein analysts estimate that Google pays Apple $8 billion a year to be the default search engine on Apple’s devices such as the iPhone, and makes around 18% of its revenues from the partnership.

In short, a hugely lucrative deal could be in the DoJ’s firing line.

But whether a lawsuit could go as far as completely ending that relationship is less certain. Following an EU ruling in 2018, Google began offering European users a choice of default search engine on Android, and Bernstein analysts speculate such an agreement could be enforced in the US. 

In a paper shared with Business Insider, the analysts speculate that such a ruling could feasibly be enforced in the US too, one that extends to iOS devices. In turn, this would mean a less lucrative deal for Apple, which may be spurred to find alternative options such as investing in its own search engine, the analysts suggest.

Antitrust lawyers said this may be a focus of the case simply because it is more developed than other parts of the investigation, giving regulators an example of Google acting in a way that has excluded search rivals.

‘The potential remedy for search is not as clear’

For Google’s advertising technology, experts say that finding a remedy could be more clear-cut, but say search may be less obvious.

“The potential remedy is not as clear,” said Gary Reback. “If I have an overcharge, I’m going to do what I need to do to eliminate the overcharge. But if I have search bias, what do I do now? The big competitors have been run out of business. So how am I going to fix that?”

All the experts Business Insider spoke to agreed that a case – or cases – could be dragged out for several years, but some suggested that in itself could be lawmakers’ ultimate remedy against the company.

“There will be discoveries, there will be hearings, there will be leaks of information. However many years it goes on, it’s not going to be pretty for Google,” said Rebeck.

That could be far more damaging for Google, experts say. But it won’t be the only thing on Google’s mind.

“What Google will be worried about is some kind of injunction, or worse, some kind of breakup threat,” said Weinstein. “I would have said 3 years ago that’s not something any company needs to worry about, but the landscape has changed a lot.

“That’s the nightmare scenario for Google.”

SEE ALSO: This chart shows how Google’s search popularity among online shoppers could provide a boost in its e-commerce rivalry with Amazon

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