A new lawsuit filed late last week accuses Google (GOOG) of "illegally monopolizing" the mobile search market in the U.S. The antitrust class-action suit claims that Google is stifling competition, driving up the price of phones and engaging in monopolist behavior through its Mobile Application Distribution Agreements. Google has also been charged with anti-competitive placement of its applications, forcing hand-held device manufacturers to include all of Google’s apps such as YouTube in exchange for Google’s Android operating system.
A Google spokesperson responded to the lawsuit, telling Reuters: "Anyone can use Android without Google and anyone can use Google without Android. Since Android's introduction, greater competition in smartphones has given consumers more choices at lower prices."
The Daily Ticker's Aaron Task and Henry Blodget discuss whether Google is starting to resemble a tech giant that has fought its own share of antitrust battles: Microsoft (MSFT).
“There are echoes of what Microsoft did to PC manufacturers in an effort to crush Netscape,” says Task in the video above.
Microsoft spent 21 years fighting government regulators over its stranglehold in the PC market. Insiders believe the antitrust lawsuits led Bill Gates to step down as Microsoft CEO.
Blodget doubts Google will suffer the same fate as Microsoft.
“Google is huge, rich and incredibly powerful and it will attract more and more regulatory scrutiny,” he argues. But “its operating system is free. I don't see anyone getting hurt by this.”
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