A lawsuit alleges that a conspiracy agreement struck between Apple and Google in 2005 locked competitive search engines out of business, and a judge inexplicably chose to let it go to trial.
There are many reasons to look at the relationship between Apple and Google from a regulatory lens, but a new class action lawsuit in Canada takes on a very particular perspective. This isn’t the first time the relationship between Apple and Google has been called into question, but the new class action lawsuit focuses on Apple.
According to a document shared for the first time in British Columbia 9to5Maca judge has chosen to allow a class action lawsuit against Apple to proceed to trial. It originally involved Google, but Google Search Ads has an arbitration clause that had to be honored.
The plaintiff was told to pursue Google through that arbitration clause, but never did. Instead, the lawsuit was amended to focus on Apple’s alleged conspiracy to ensure that Google became the global search giant that controls the market.
The crux of the lawsuit suggests that Apple and Google explicitly went into business in 2005 to provide a default search engine to Apple Computers as a means of controlling the search industry. As part of this conspiracy, Apple agreed not to develop a search engine.
Apple’s lack of a search engine apparently meant that Google was able to control the market and set prices. Since the lawsuit is against Apple, it appears that the blame for Google’s high advertising prices is placed on Apple.
Bad logic on all fronts
There are many logical flaws in this argument, such as Apple’s lack of market share in 2005. At the time the company apparently had no interest in developing a search engine and simply needed one for its customers.
Google is the default search engine in Safari
Google was a company that offered a search engine, and the deal meant that Apple got a share of the search advertising revenue. The judge appears to ignore all the evidence and agrees that the plaintiff has a valid complaint.
Although the partnership was changed to include iPhone in 2007, it has not been a major player in subsequent years. Apple didn’t start to surpass 40% market share in most markets until around 2020 in some places.
The partnership with Google was also for a default search engine, not the only search engine. Customers have always had the option to choose alternatives like Bing.
Furthermore, the class action is moving forward in a world where Apple has its own Internet advertising business. There’s also Spotlight and Apple’s Siri which can be used almost entirely in place of a search engine.
It will be a strange class action to watch as the trial tries to establish potential damages. The plaintiff suggests that Apple is responsible for the higher prices that Google sets for its ads, so Apple must compensate the victims.
The whole thing is maddeningly convoluted, since the company that sets prices and controls the search market isn’t even part of the lawsuit. It’s really a head-scratcher why a judge would allow this to go forward, but perhaps something more will be revealed during the trial.
No trial dates have been set.
