Google could use AI to extend search monopoly, DOJ says as trial begins

Alphabet's Google GOOGL.O needs strong measures imposed on it to prevent it from using its artificial intelligence products to extend its dominance in online search, a U.S. Department of Justice attorney said as the trial in the historic antitrust case began on Monday.

The outcome of the trial could fundamentally reshape the internet by unseating Google as the go-to portal for information online. The DOJ has compared the lawsuit to its past efforts to break up AT&T, Microsoft, and Standard Oil.

"The time to tell Google and all other monopolists who are out there listening, and they are listening, that there are consequences when you break the antitrust laws," DOJ attorney David Dahlquist said during his opening statement.

The DOJ and a broad coalition of state attorneys general seek to force Google to sell off its Chrome browser and take other measures to restore competition even as search evolves to overlap with generative AI products such as ChatGPT.

"This court's remedy should be forward-looking and not ignore what is on the horizon," Dahlquist said.

Witnesses from Perplexity AI and OpenAI will testify about how search and AI overlap and how Google's dominance affects their business, Dahlquist said.

Google argues that its AI products are outside the scope of the case, which focused on search engines. Adopting the proposed remedies "would hold back American innovation at a critical juncture," Google executive Lee-Anne Mulholland said in a blog post on Sunday.

The company plans to appeal the final ruling in the case.

Antitrust enforcers have proposed far-reaching measures designed to quickly open the search market and give new competitors a leg up.

Their proposals include ending exclusive agreements in which Google pays billions of dollars annually to Apple AAPL.O and other device vendors to make Google the default search engine on their tablets and smartphones.

Google would also have to license search results to competitors, among other requirements. And it would be made to sell its Android mobile operating system if other remedies fail to restore competition.

Google sees the proposals as extreme and said the court should stick to limiting the terms of its default agreements.

The $1.9 trillion tech company has been subsidizing browser makers such as Mozilla by paying to remain the default search engine. Cutting off that financial support could threaten their existence, Google says. And ending payments to device makers would raise the cost of smartphones, the company claims.

Google plans to call witnesses from Mozilla, Verizon VZ.N, and Apple, which launched a failed bid to intervene in the case.

Few potential buyers of Chrome have the same incentive as Google to maintain the free open-source code that underpins it, and which others including Microsoft use as a basis for their own browsers, the company says.

The trial comes on the heels of a win for the DOJ in a Virginia court on Thursday, where a judge ruled in a separate antitrust case that Google maintains an illegal monopoly in advertising technology.

Meta Platforms META.O is currently facing its antitrust trial over the acquisitions of Instagram and WhatsApp.