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Technology Stocks : Alphabet Inc. (Google)
GOOGL 185.04-0.3%3:59 PM EDT

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From: Sr K5/3/2024 8:01:35 AM
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May 3, 2024, 5:04 a.m. ET

On Tuesday, Google’s employees gathered for an all-hands meeting named T.G.I.F. These companywide meetings are rarely held on Fridays these days, but the name has stuck.

Executives shared highlights from a recent earnings report and cloud-computing conference, and warned workers against taking disruptive actions in the wake of internal protests against a cloud-computing contract with Israel.

But no one in the meeting, two employees said, broached a topic that could have a dramatic impact on Google: its landmark antitrust trial with the Justice Department, where arguments are finally coming to an end this week.

For eight months, while tech policy experts have tried to divine what a Google victory or loss would mean for the power of tech giants in the United States, Google’s employees have mostly ignored the antitrust fight, according to interviews with a dozen current and recent workers, who asked not to be identified because they were not authorized to discuss the legal matter.

Even among Google’s outspoken employees, the legal risks facing the company have become background noise. For two decades the company has been one of Silicon Valley’s apex predators, and its workers have grown accustomed to Google’s breezing past regulatory scrutiny. Why expect something different this time?

Besides, they added, the more pressing threat to Google is a competitive one posed by Microsoft and OpenAI, the maker of the ChatGPT chatbot. (The New York Times sued OpenAI and Microsoft in December for copyright infringement of news content related to A.I. systems.)

Closing arguments in the trial began on Thursday in U.S. District Court for the District of Columbia and are expected to last two days. The Justice Department has taken aim at Google’s search business, claiming the company illegally extended its monopoly by forging default search deals with browser makers, such as Apple and Mozilla. Google has said that the contracts are legal and that its innovations have broadened competition, not constricted it.

Peter Schottenfels, a Google spokesman, said in a statement that the Justice Department’s case “is deeply flawed.”

“Our employees know that we face intense competition — we experience it every day,” Mr. Schottenfels said. “That’s why we are focused on building innovative and helpful products that people choose to use.”
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Even among Google’s outspoken employees, the legal risks facing the company have become background noise.Credit...Jason Henry for The New York Times

On Thursday, Judge Amit P. Mehta stress-tested the Justice Department’s and Google’s arguments in court. He prodded the Justice Department on its assertion that Google’s market power had hindered its search engine’s innovation or quality for consumers.

“I’m struggling to see how I could reach findings of fact that would say, ‘Google has not done enough,’ or ‘Google’s product has worsened over the course of 10 years,’ in such a way that I could say it’s because of lack of competition,” Judge Mehta said.

He also questioned Google’s assertion that it faced competition from sites like Amazon, where consumers go to search for pricing and other results while shopping, saying the average person would see a difference between Google and Amazon.

Soon, it will be up to Judge Mehta to decide. If Google loses, there is a wide range of potential consequences. Google could be forced to make small changes to its business practices or face a ban on the types of default contracts that have helped make its search engine ubiquitous. The Justice Department could also call for the divestiture of one of Google’s search distribution platforms like the Chrome browser or the Android mobile operating system — a drastic but less likely outcome.

For more than a decade, Google has faced fines and government lawsuits in Europe and elsewhere, while notching significant revenue and profit gains. That has made all the legal wrangling look like the cost of doing business to some employees, two people said.

Google employees have been taught to avoid talking or writing about lawsuits. The company always tells employees to “communicate with care,” as laid out in an internal document reviewed by The Times. In other words, what you write can end up becoming an embarrassing bit of evidence in court.

When an employee in Google’s advertising department recently mentioned news articles about the antitrust lawsuit at the office, co-workers shook their heads and said, “We don’t talk about that,” the person said.

But lawsuits happen all the time. In the last six months, Google has settled cases at a steady clip, ending privacy, patent and antitrust claims against the company. Those suits didn’t cause much to change, leading some employees to believe that this case is no different.

When employees do talk about the Justice Department suit, they echo one of the company’s arguments: that the allegations against Google Search are outdated, especially as the tech industry has rushed to develop artificial intelligence systems that could alter the search market, two people said.

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