The Google Paradox

by | Mar 18, 2021 | Media

Our founding partner, Juan Carlos Gómez, talks about the anti-competitive practices of one of the world’s largest technology companies and how it is under scrutiny from the authorities.

Twenty years ago, Google was on the side of those who accused Microsoft of anti-competitive practices. Now it will be its turn to be in the dock. Last week, the US Department of Justice and the attorneys general of eleven states filed a lawsuit against it for anti-competitive practices in the internet search and advertising markets.

This comes as no surprise: Google has been under the authorities’ scrutiny for several years. In Europe it has been sanctioned several times with fines that, in any case, do not make much of a dent in its US$120 billion free cash flow. However, this is the first legal action taken by the US authorities against it. It will be an unprecedented legal battle, in terms of lawyer and expert witness costs as well as legal, economic and technical theories. Not since the legendary cases against ATT&T (1974) and Microsoft (1998) has there been an antitrust action of such dimensions.

In the Microsoft trial, the judge found anti-competitive acts by a technology giant to prevent other players from entering distribution channels and to prevent users from freely accessing content and applications. Google is now accused of equivalent conduct. It is also a paradox that, without the Microsoft judicial precedent, Big Tech (Apple, Google, Amazon and Facebook) would probably not have been able to flourish.

The litigation will take several years to resolve and will undoubtedly be affected by the upcoming change of government and the composition of the US Congress. Many experts believe that nothing effective will be achieved without a new regulatory framework that imposes ex ante explicit prohibitions. Others advocate the idea of a single regulator for digital markets. England has already made an announcement in this direction, as have the European Union and Australia.

In Colombia, the Ministry of ICTs, the CRC and the SIC are at a sidereal distance from the challenge posed by Big Tech. There is neither the legal framework nor the institutional strength to face the future.

Juan Carlos Gómez Jaramillo
Founding Partner

El Espectador- La paradoja de Google