Microsoft CEO Satya Nadella has testified in the US antitrust trial against Google, where he spoke about the tech giant’s search engine dominance on the market.
Nadella hit out sharply at the business practices of his archrival in the tech industry, which he said made it difficult for entry by other players. He equated the online search dominance of the Alphabet-owned firm as a “nightmare” for the future of AI if allowed to remain in place.
Nadella has become the most senior tech executive so far to testify in the case, which is focusing on Google’s dominance as a default search engine across the world on browsers and mobile devices. The case hinges on claims that Google used unfair practices to entrench itself as the dominant player in the business.
Nadella’s statements have also revealed the rivalry between the two tech giants and how Bing is struggling to gain market share.
Choking competition
The three-month-long trial is reportedly the biggest antitrust case against a tech giant after Microsoft went through the same fate—before the Justice Department—over its Windows operating system’s dominance over two decades ago.
In his appearance in a Washington, DC, courtroom, Nadella supported the government’s contention about Google’s market dominance.
“You can call it popular, but to me it’s dominant,” Nadella told a Google lawyer during cross-examination.
Nadella went on to explain Google’s power over people’s behaviors, as they now find everything on the internet.
“You get up in the morning, you brush your teeth, and you search on Google,” he said.
Since 2009, Microsoft’s Bing has been trying to build market share and compete against Google but has never been able to stand against the search engine giant because of, among other factors, its arrangements with Apple.
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Default search engine
Google’s arrangements with companies like Apple to make it the default search engine for millions of internet users have also added to its dominance in business.
Microsoft has poured billions of dollars in investments into its Bing, but it has remained with a single-digit market share in mobile search and slightly more into the teens desktop search. The tech giant has for long aspired to command at least 20% of market share in both segments.
“It becomes even harder to break through when you don’t have (market) share,” he said.
During the trial, Nadella revealed how his firm has attempted to persuade Apple to switch from Google to Bing as its default search partner without any success, despite making an offer of about $15 billion a year for the privilege.
According to a CNN report, a senior Apple executive, Eddy Cue, who testified last week, indicated his company has always viewed Google as the best search engine for their users. This claim was supported by Google itself during the trial.
People use Google because “they want to”
Google has vehemently denied any trickery in its dominance and maintained that the market can easily switch default search engines whenever they want to. According to the tech giant, other alternatives are just “a click away.”
However, people use Google because they do not want to use anything else, according to the company.
“People don’t use Google because they have to; they use it because they want to,” one of Google’s lawyers and its president of global affairs, Kent Walker, wrote at the start of the trial.
“It’s easy to switch your default engine; we’re long past the era of dial-up internet,” he added.
Nadella called this a “bogus” argument.
New angle with AI
Nadella added his concerns that Google’s dominance will also extend to AI.
He said he was worried the company would use this dominance to “strongarm content providers” essential to training generative AI models.
“In fact, if anything, I worry a lot in spite of my enthusiasm that—there is this new angle with AI—this vicious cycle can become even more vicious,” said Nadella.
Microsoft has, however, continued to invest in its Bing and this year integrated AI into the search engine, which created the impression that this would put pressure on Google. But Nadella said Google could leverage its massive profits from search to pay publishers for exclusive rights to content to improve its search AI and make it better than rivals.
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