Could Antitrust Probes Slow Google’s Cloud Business?



Google (GOOGL) is the subject of several antitrust probes in the US. Yesterday, a probe by a coalition of 50 US states and territories announced an antitrust probe into Google. That announcement follows news of a DoJ (Department of Justice) antitrust probe into Google. Could these probes weigh on Google’s cloud computing business?

Google cloud computing head Thomas Kurian discussed the issue in an interview with CNBC yesterday. According to Kurian, the antitrust probes don’t concern Google’s cloud business. “They’re different businesses,” he said, adding, “There’s a business in the consumer space. There’s business in the enterprise space. The cloud business [is] really in the enterprise space.”

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The DoJ wants to know if Google is playing fairly

In July, the DoJ announced a broad antitrust review of big tech companies. And recently, Google disclosed that the DoJ had asked it to turn over records about its past antitrust investigations. As we discussed previously, Google has been the subject of many antitrust investigations around the world. In the European Union, for instance, Google has been fined nearly $10 billion since 2017.

However, the DoJ antitrust probe into Google relates to the company’s consumer-facing business, not the cloud. In its letter announcing the big tech probe, the DoJ said it was targeting companies that dominate the Internet search, social media, and online retail service spaces. In August, Google dominated Internet search services with 88% of the market, according to StatCounter. Microsoft (MSFT) placed a distant second with 2.6%.

State-led antitrust probe focuses on Google’s search and ad businesses

There’s no indication that the state-led antitrust probe is targeting Google’s cloud computing business, either. “The bipartisan coalition announced plans to investigate Google’s overarching control of online advertising markets and search traffic that may have led to anticompetitive behavior that harms consumers,” the letter announcing the multistate Google probe said.

Moreover, Bloomberg reported today that the states have asked Google to provide information about its largest advertising clients, how it charges for ads, and the ad technology companies it has acquired—nothing about Google’s cloud computing business.

$214 billion up for grabs in the cloud market

Google would be pursuing a $214 billion revenue opportunity in the global cloud market this year, Gartner estimates show. In July, Google disclosed that its cloud business brings in $8.0 billion in annual revenue, up from its previously announced $4.0 billion.


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