Google is being sued in the UK for up to £5bn in damages over allegations it shut out rivals in the internet search market and abused this dominance to overcharge businesses for advertisements.A class action filed at the competition appeal tribunal on Tuesday argues that the US technology company has taken actions that enable it to charge higher prices for the promotions that appear in search inquiries than it otherwise could in a fair market.It alleged that Google, which is owned by the US tech companyAlphabet, contracted phone makers to preinstall the Google search app and Chrome browser on Android devices and paid Apple to make it the default search engine on iPhones, with the intention of shutting out competition.The claim is filed by the competition law expert Or Brook on behalf of thousands of businesses and alleges Google ensured its search engine had better functionality and more features for Google’s own advertising offering than that of its competitors.UK competition watchdog investigates Apple and Google’s mobile platformsRead moreAGooglespokesperson said: “This is yet another speculative and opportunistic case – and we will argue against it vigorously. Consumers and advertisers use Google because it is helpful, not because there are no alternatives.”Brook said businesses had almost no choice but to use Google ads to advertise their products and services.“Regulators around the world have described Google as a monopoly and securing a spot on Google’s top pages is essential for visibility,” she said in a statement. “Google has been leveraging its dominance in the general search and search advertising market to overcharge advertisers.”TheCompetition and Markets Authoritylaunched a UK investigation in January into Google’s search services which is still ongoing, including into their impact on advertising markets. It said at the time that millions of people and businesses relied on Google’s services, which accounted for 90% of searches and were used by more than 200,000 UK businesses to advertise.Google is facing several competition investigations and lawsuits around the world that relate to its digital advertising market dominance.Since September, it has been embroiled in asecond antitrust trialin the US over whether it has illegally monopolised the digital advertising industry, afterlosing a landmark case in August, which it is also appealing against.One Google ad executivequoted in the US government’s complaintcompared the company’s business model to Goldman Sachs or Citibank owning the New York Stock Exchange.A loss in that trial could force Google to break up parts of its business and divest some of its advertising technology, hitting its primary source of revenue. It would also have far-reaching implications for the wider tech industry and online publishers.In March, the European CommissionaccusedGoogle of breaking its competition rules for digital markets by prioritising search engine results that pointed to Alphabet’s own services over those of rivals, breaching the requirement to treat third-party services in a “transparent, fair and non-discriminatory” way.skip past newsletter promotionSign up toBusiness TodayFree daily newsletterGet set for the working day – we'll point you to all the business news and analysis you need every morningEnter your email addressSign upPrivacy Notice:Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see ourPrivacy Policy. We use Google reCaptcha to protect our website and the GooglePrivacy PolicyandTerms of Serviceapply.after newsletter promotionBreaches of the EU’s Digital Markets Act can result in companies being fined 10% of worldwide revenue, or 20% if they reoffend.However, Donald Trump has been seeking to pressure governments and institutions into dropping competition lawsuits against tech companies by indicating that he will factor any regulatory action against US companies into his decisions about imposing sweeping tariffs on foreign goods.It emerged earlier this month that the UK government wasconsidering a reduction in the headline rate of its digital services tax– a 2% levy introduced in 2020 on the revenues of tech companies including Amazon, Google and Apple that raises about £800m a year – in an attempt to placate the US president.
Google sued for £5bn in UK over allegations of shutting out rivals
TruthLens AI Suggested Headline:
"Google Sued in UK for £5 Billion Over Alleged Anti-Competitive Practices"
The Guardian
8.3
TruthLens AI Summary
Google is facing a significant class action lawsuit in the UK, seeking damages of up to £5 billion. The lawsuit, filed at the competition appeal tribunal, accuses the tech giant of using its dominant position in the internet search market to stifle competition and overcharge businesses for advertising. The claim, brought forth by competition law expert Or Brook, alleges that Google has taken steps to ensure its search engine is preinstalled on Android devices and made the default search engine on iPhones through contracts with manufacturers. These actions, the lawsuit argues, have effectively limited the options available to businesses, forcing them to rely on Google Ads for visibility in search results. Brook emphasized that the monopoly-like status of Google has significant implications for advertisers, who find themselves with few alternatives in a market where Google controls approximately 90% of search queries in the UK.
The ongoing scrutiny of Google’s practices is part of a broader investigation into its dominance in the digital advertising market. The UK's Competition and Markets Authority (CMA) has been investigating Google's search services since January, focusing on their impact on the advertising landscape. This lawsuit is one of many challenges Google faces globally, including antitrust trials in the United States, where it has been accused of monopolizing the digital advertising industry. A recent antitrust ruling against Google could lead to major changes in its business operations, possibly requiring the company to divest parts of its advertising technology. Furthermore, the European Commission has also accused Google of violating competition rules by favoring its own services in search results. These developments highlight the increasing regulatory pressure on major tech companies and the potential for significant changes in how they operate in the digital marketplace.
TruthLens AI Analysis
This news report highlights a significant legal challenge against Google in the UK, where the company is accused of anti-competitive practices in the search engine and digital advertising markets. The lawsuit, seeking £5bn in damages, alleges that Google's dominance has led to inflated advertising costs for businesses, with claims that the tech giant manipulated the market by securing preferential placement on devices and browsers.
Market Dominance and Anti-Competitive Practices
The core allegation revolves around Google's alleged suppression of competition through exclusive agreements with device manufacturers like Apple and Android phone makers. By making its search engine the default option and pre-installing its apps, Google is accused of creating an uneven playing field. The lawsuit argues that this dominance allows Google to overcharge advertisers, who have little choice but to pay for visibility on its platform.
Regulatory Scrutiny and Corporate Response
The UK's Competition and Markets Authority (CMA) is already investigating Google's practices, reflecting broader global concerns about Big Tech's market power. Google's dismissal of the lawsuit as "speculative and opportunistic" suggests a defensive stance, emphasizing consumer choice and the availability of alternatives—a narrative often used by dominant tech firms facing regulatory pushback.
Potential Economic and Political Implications
If the lawsuit succeeds, it could set a precedent for stricter regulation of tech monopolies, potentially reshaping digital advertising markets. Smaller businesses and competitors might benefit from a more level playing field, while Google's revenue model could face significant pressure. Politically, this case aligns with growing calls for antitrust reforms targeting Silicon Valley giants.
Target Audience and Public Perception
The news likely resonates with businesses, advertisers, and policymakers concerned about fair competition. It may also appeal to consumer advocacy groups and critics of Big Tech's influence. The framing of Google as a monopolistic entity reinforces negative perceptions of its market control, potentially galvanizing support for regulatory action.
Manipulation and Reliability Assessment
The report appears fact-based, citing legal filings and regulatory actions. However, the portrayal of Google as a monopolist could be seen as leaning toward a critical perspective, though this aligns with ongoing antitrust debates. There is no clear evidence of AI-driven manipulation in the writing style, though the narrative fits broader media trends scrutinizing tech giants.
Financial and Global Power Dynamics
A ruling against Google could impact its stock price and investor confidence, particularly in the advertising sector. Competitors like Microsoft (Bing) or emerging search platforms might gain traction. Globally, this case reflects the escalating tension between tech corporations and governments seeking to curb their influence.
Final Verdict on Reliability
The news is credible, given its alignment with verified legal actions and regulatory investigations. While the tone leans critical, the facts presented are substantiated, making it a reliable source for understanding current antitrust challenges against Google.