Alphabet’s Google is facing a major class action lawsuit in Britain, seeking potential damages of up to £5 billion ($6.6 billion), over allegations of abusing its dominant market position in the online search sector. The case was filed at the Competition Appeal Tribunal on Tuesday by competition law expert Or Brook, acting on behalf of thousands of businesses.
The lawsuit contends that Google leveraged its dominance to impose higher prices for advertisements appearing in search queries than would be possible in a competitive market. Central to the claim is Google’s practice of contracting with phone manufacturers to have Google Search and its Chrome browser pre-installed on Android devices. Additionally, Google is accused of paying Apple to set its search engine as the default on iPhones. The suit argues these arrangements were intended to shut out rival services.
Further allegations include Google enhancing its search engine’s functionality and features specifically to favour its advertising services over competitors, thereby securing an unfair advantage. Brook stated in a public comment, “Regulators around the world have described Google as a monopoly and securing a spot on Google’s top pages is essential for visibility. Google has been leveraging its dominance in the general search and search advertising market to overcharge advertisers.” She also highlighted that businesses had limited alternatives and were almost compelled to rely on Google Ads to promote their products and services effectively.
In response to the lawsuit, a Google spokesperson described the case as “yet another speculative and opportunistic case” and affirmed the company’s intention to contest it vigorously. “Consumers and advertisers use Google because it is helpful, not because there are no alternatives,” the spokesperson added.
This legal action comes amid an ongoing investigation by Britain’s antitrust regulator, the Competition and Markets Authority (CMA), which began in January this year. The CMA’s enquiry focuses on Google’s search services and their impacts on advertising markets. The regulator noted the significant reliance on Google, with its services accounting for approximately 90% of online searches in the UK and being used by over 200,000 British businesses for advertising purposes.
The class action lawsuit underscores growing regulatory scrutiny and legal challenges faced by major tech companies over concerns of market dominance and competition fairness in digital advertising and search services.
Source: Noah Wire Services