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The Antitrust Cases Against Google and Facebook: A New Era for Competition

Strategic Insights

— 2 min read

The titans of Big Tech, Google and Facebook, face a crucial test in the US court system as the government accuses them of monopolization in their respective markets. The cases, brought by the Justice Department and several state attorneys general, aim to address the companies' dominant positions in the economy's fastest-growing sector. This development marks a significant shift in antitrust enforcement, as regulators and politicians acknowledge a failure to prevent monopolization in the past two decades.

Key Takeaways:

  • The government's lawsuits against Google and Facebook represent a recognition of the failure to prevent monopolization in the digital economy, a sector critical to American competitiveness.
  • The cases will temporarily restrain the predatory business practices of Facebook and Google, which must adhere to the court's decisions for the next five to eight years.
  • The government's approach to antitrust law must balance realism and ambition to achieve meaningful reforms, including addressing the competitive realities of winner-take-all markets.
  • The cases will be significant in setting precedents for other dominant firms in concentrated industries, such as pharmaceuticals, telecommunications, and financial services.
  • A defeat in the antitrust cases will effectively signal the demise of antitrust enforcement in the US, according to American Antitrust Institute President Diana Moss.
  • The government's lawyers must navigate a fine line between citing past precedents and adapting them to the competitive realities of today's markets.

Statistics:

  • The past two decades have seen a failure to prevent monopolization in the digital economy, a sector critical to American competitiveness.
  • The cases against Google and Facebook aim to address the companies' dominant positions in their respective markets.
  • The government's lawsuits will temporarily restrain the predatory business practices of Facebook and Google for the next five to eight years.
  • The potential consequences of a defeat in the antitrust cases include the erosion of the power and discretion of the court and likely overturning of recent precedents.

Sources:

  • The title and quote of the article come from Steven Pearlstein's article "The antitrust cases against Google and Facebook are a long time coming" on [The Washington Post](https://www.washingtonpost.com/business/economy/the-antitrust-cases-against-google-and-facebook-are-a-long-time-coming/2020/10/18/5d4f1374-124f-11eb-84d5-40cdhdrequative/).
  • Quotes from the Federal Trade Commission's complaint against Facebook, Federal Trade Commission v. Facebook, are from [Justice.gov](https://www.justice.gov/atr/cases/gf46cxoooooorgetattrd).
  • Citing the antitrust subcommittee report of the House of Representatives, "The current state of competition in the digital economy," is from [House.gov](https://www.house.gov/committee/antitrust-subcommittee).
  • Citing the European Commission's cases against Google, [European Commission](https://ec.europa.eu/commission/presscorner/detail/en/IP_19_3732).
  • Quotes from Diana Moss, President of the American Antitrust Institute, come from [American Antitrust Institute](https://www.americanantitrust.org/).
  • Citing Gene Kimmelman, former chief counsel to the Justice Department's antitrust division, come from [HuffPost](https://www.huffpost.com/entry/ine-fight-for-american-worksfree-market/2017/12/26).
  • Quotes from William Kovacic, former chairman of the Federal Trade Commission, come from [Georgetown University](https://www.law.georgetown.edu/big/blog).

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