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Google This: A Look at the Antitrust Suits Facing the Tech Giant


With an FTC decision pending, will Google find itself deleted?

The Most Likely Outcome?

Back in October, CNET took a look at one potential outcome of an antitrust lawsuit against Google. Thomas Barnett is a DC-based lawyer who runs the coalition, a lobby against Google for fair search practices -- Hotwire, Nokia (NYSE:NOK), and Oracle (NASDAQ:ORCL) are members. The article quotes his opinion on one alternative outcome of an Google antitrust lawsuit.

"Another option, Barnett said, would be a breakup involving 'cutting, severing, certain parts' of the Mountain View, Calif.-based company. 'I'm not saying that's necessarily what's called for here -- but be careful,' he said." That's right: A possible Google breakup is in the cards, albeit at the bottom of the pile.

Google couldn't really fall victim to modern day trustbusters, could it?

Way back in 1998, Microsoft found itself in a similar seat, when the US Justice Department ruled the software company was in violation of the Sherman Antitrust Act. Microsoft was accused of unfairly restricting the market for competing Web browsers by bundling its own Internet Explorer software with its Windows operating system. After Microsoft was found guilty of monopolizing the personal computer software market, it appealed, and this appeal led to a settlement.

What's so interesting about the settlement is that Microsoft was neither forced to rewrite its code, nor to stop packaging its IE software with Windows. The settlement only required Microsoft to make its source code and records openly available to third-party companies.

As pointed out by the Wall Street Journal, a Google antitrust case would be the country's biggest since Microsoft. The article also brings up an earlier antitrust case against IBM (NYSE:IBM), in the 1960s.

Wall Street Journal contributor L. Gordon Crovitz writes:

IBM spent more than $4 billion in today's dollars defending itself beginning in the 1960s, producing 750 million documents for the government. As the case dragged on, technology changed so much that IBM's dominance in mainframe computers became a liability. Likewise, Microsoft's operating system and Web browser diminished in importance during the company's time in court in the 1990s as new competitors, including Google, emerged.

IBM mainframe dependency is an interesting point to bring up. Any sort of Google breakup would likely prove to be a logistical nightmare when considering the permeation of Google's products. But, even if Google, like Microsoft before it, moves out of whatever legal actions the US government takes unscathed, does it leave enough wiggle room for the 'next Google' to wedge itself in?

In terms of direct costs the antitrust suit could have on Google, Crovitz writes, according to the FTC commissioners he has spoken to, fines could reach into the billions, carving a significant chunk out of Google's roughly $10 billion in yearly profits.
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