Source: Leon Neal/Getty Images

Is Google a Monopoly? Tech Giant Faces Questions Over Search and Advertising



On Wednesday, Amazon, Apple, Facebook, and Google CEOs faced lawmakers for a hearing on digital competition. Some in Congress and the Senate believe that the big tech companies have formed monopolies in their respective spheres, stifling competition and, in some cases, democracy.

Google, the world's most popular search engine, has long faced accusations of being a monopoly. So, is Google actually a monopoly?

Why some argue Google is a monopoly

First, we should know what a monopoly is. Oxford Languages defines the term as "the exclusive possession or control of the supply of or trade in a commodity or service."

Those who argue that Google is a monopoly usually focus on two aspects of the company's business—search and online advertising.

Source: Graeme Jennings - Pool/Getty Images

There is no denying when it comes to search that Google is the most significant player out there. Many people refer to using a search engine as the act of 'googling.'

According to Visual Capitalist, when you include searches performed on all of Google's platforms, the company handles over 90 percent of all internet searches. The next biggest competitor, Yahoo, comes in at just 2.4 percent.

The European Commission has also accused Google of violating antitrust laws in the online advertising space. Last year, Google was fined €1.49 billion (~$1.75 billion) after they found that the company had "abused its market dominance by imposing a number of restrictive clauses in contracts with third-party websites which prevented Google's rivals from placing their search adverts on these websites."

According to their press release, Google dominates the online advertising space in the European Economic Area. Across the entire market, Google's market share was 70 percent. In some individual countries, the figure was as high as 90 percent.

In the United States, online publishers have accused Google of using their dominance to take a large cut of their advertising revenue. The News Media Alliance cites a report from The Guardian that suggests publishers see as little as 30 or 40 cents on every dollar spent to advertise on their site.

Does Google violate privacy?

Google has faced numerous accusations of violating user privacy and has paid several large fines as a result. 

In 2012, Google paid a $22.5 million civil penalty to the FTC (Federal Trade Commission) after they allegedly tracked users of Apple's Safari browser with cookies, despite telling users that the browser blocked cookies by default.

In a 2013 settlement, Google paid $17 million to 37 states and the District of Columbia over a similar case.

And in 2019, Google agreed to pay another $170 million to the FTC to settle allegations that YouTube had illegally collected personal information from children without their parents’ consent. The penalty, by far the largest that the FTC had ever collected, came after Google was accused of violating the COPPA (Children’s Online Privacy Protection Act) Rule. 

Source: istock

However, it is worth noting that Google has also fought for its users' privacy.

In 2005, Google refused to turn over information about the search terms that users had been entering into the search engine to the Department of Justice of then-President George W. Bush. A year later, a court ruled partially in Google's favor and recognized the privacy implications.

More From Market Realist