Google, the search engine giant fined $5.1 billion over anticompetitive practices in Europe last year, tumbled in New York trading after reports that prosecutors are planning an antitrust investigation of the company in the U.S.
Shares in the Mountain View, Calif.-based company dropped 6.1% to $1,036.23 on Monday after the investigation was described in a Wall Street Journal article. The investigation marks the latest escalation in complaints that Silicon Valley standouts from Google to Facebook and Amazon have amassed monopoly powers, in part by competing with their own customers and advertisers.
It’s a debate likely to grow as the 2020 presidential campaign intensifies, with Sen. Elizabeth Warren, a leading Democratic contender, already calling for the breakup of a number of tech stars. Republicans including President Trump, meanwhile, have accused both Google and Facebook of suppressing conservative opinions, and the Supreme Court recently allowed an antitrust lawsuit against Apple to go forward.
A spokeswoman for Google declined to comment, and the Justice Department didn’t immediately respond to a message seeking comment.
“Antitrust investigations are difficult to predict,” Justin Post, an analyst with Charlotte, N.C.-based Bank of America, said in a report. “If the Department of Justice moves ahead, an investigation would likely embolden critics of Facebook, Amazon, and other tech giants as well, causing rhetoric to heat up during the 2020 election year.”
To break up Google, the Justice Department would have to convince federal courts that doing so is necessary to address anticompetitive concerns, Post noted. It’s a move taken only rarely, he said, as with John D. Rockefeller’s Standard Oil in the early 1900s and AT&T in the 1980s.
An attempt to do the same with Microsoft ultimately failed, and this wouldn’t be the first time Google has faced such claims. In 2013, the Federal Trade Commission said it hadn’t found sufficient evidence to show that the company manipulated its search tools to hurt competitors, though it noted that some rivals had been demoted in search results.
In 2018, European regulators said Google had required phonemakers using its open-source Android operating system to install the Google Search and Google Chrome apps on devices in order to connect to the Google Play app store. Phonemakers were barred from preinstalling Google apps on any devices if they also offered products running Android software developed without the company’s approval.
“Google has used Android as a vehicle to cement the dominance of its search engine,” Margrethe Vestager, the European Union’s commissioner for competition, said at the time. “They have denied European consumers the benefits of effective competition in the important mobile sphere.”
In September, then-U.S. Attorney General Jeff Sessions — since replaced by William Barr — met with representatives from the offices of 14 state attorneys general to discuss related issues including how much leverage existing antitrust law affords regulators in dealing with tech companies.
Existing laws, including the Sherman Antitrust Act, give the government the power to do so in certain cases, which might lend weight to any requests for reforms from policymakers.
