Apple files emergency motion to become defendant in US vs. Google [pdf]

There's the idealized America that we learn about in school, then there's America as it is.

I guess ideals are a nice tool to compare something against to measure something's relative value. But they can also be used as a whitewash. Maybe the difference is how engaged an informed citizen body is with the government.

We are discovering that enough of the electorate does not care when some politicians do it, so that the ideal is unenforceable, and I think it’s because of the media.

It is not allowed. People are conflating a private lawsuit between Donald Trump and some large corps, with the Justice Dept suing large corps. Justice Dept can't settle and give money the money away. Let's not let politics lobotomize our common sense.

Sure, during the 2018 election, candidates, parties, PACs, and outsiders combined spent about $5 billion – $2.5 billion on Democrats, $2 billion on Republicans, and $0.5 billion on third parties. And although that sounds like a lot of money to you or me, on the national scale, it’s puny. The US almond industry earns $12 billion per year. Americans spent about 2.5x as much on almonds as on candidates last year.

https://slatestarcodex.com/2019/09/18/too-much-dark-money-in...

It's hugely different. We limit donations from lobbyists, force them to register their activities. This settlement goes straight to Trump's pockets like Frank Hagues desk drawer.

It's not exactly this, but there is an interesting thing going on right now with the San Diego Padres in American Major League Baseball. The owner died last year and control of the team initially passed to his younger brothers. His wife wasn't happy about that and sued them and the team has ended up with an injunction pending resolution of who gets to actually control it going forward, and they've gone from being one of the most active franchises in the league of the past decade to making literally no new deals this offseason and watching all of their free agents leave. They basically can't buy anything until the court decides who of the surviving family gets to decide what to buy, which effects their own employees who can't get new contracts and any other franchises that otherwise might have traded with them.

Specifically only selling off Chrome https://www.theverge.com/2024/11/27/24302415/doj-google-sear...

DoJ asserts that owning a browser gave Google an unfair advantage in building a search engine to the degree that it prevented meaningful competition.

I don't think Google losing Chrome is too harmful to Google. I would say it's probably equal to Apple losing billions from the default search deal.

I don’t want to comment on if a breakup is a “good” thing for society, because I vaguely agree, but I’m not sure I agree with you on many points here.

> I think the valuation of a broken-up Google and Apple would exceed the monolithic conglomerates that they have become. So many of their business units and products don't even monetize because they're going for an intangible "platform value".

I think a lot of these products aren’t monetized because they’re actually bad businesses or failed ventures and companies have the free cash to support them. A lot more of Google’s (for example) random side projects seem to be getting subscriptions or collapses into existing ones. I also think that vertical integration creates unique value sometimes. I think spinning off these random side businesses could destroy the side businesses, but that this may still raise stock prices as the companies get better margins. I think a lot of these products are bad businesses because big tech salaries are high and that makes labor costs hard to account for.

I think the breakups obviously rectify consolidated power. 100%. But I don’t see more mobile phone operating systems coming from a breakup of Apple, for example. Gmail isn’t going to be replaced by a new email provider. Nor would we see a new YouTube, or other dominant businesses. Disrupting these massive aggregators won’t come from direct competition, but rather new product and service experiences. TikTok has shown that tech is already not impenetrable.

Finally, I totally agree that this would be a feeding frenzy for VCs, but VCs learned in the last decade how to rip off ICs even more through delaying IPOs and more aggressive dilution. So I wouldn’t be holding my breath as an IC that breaking up Google (or others) will make jobs better.

>And they're also a grocery store, for god's sake.

They're also your primary care doctor! Amazon OneMedical!

https://health.amazon.com/onemedical

Scroll down the page a bit.

Counter point: Would breaking up Meta, Google, Apple, Microsoft decrease the progress in AI since those major companies are forking over hundreds of billions to build out mega AI infraustructure?

Going from the breakup of AT&T to the reconstitution of AT&T took about 40 years. Standard Oil probably did the same, though I haven't seen any fancy charts showing it on a timeline like with AT&T. There's probably some useful lessons to pick up from that time if they go the breakup route.

It's fairly hard to pass substantial bills these days thanks to polarization -- when a significant portion of your base sees cooperation as a betrayal, the incentives get wonky. (Not pointing that comment at either the left or the right to the exclusion of the other.) The days of Ted Kennedy finding ways to work across the aisle are gone, at least for now.

> This is easy to solve though, just change the laws.

When a large subset of people only care about culture war, this isn’t easy.

> This is easy to solve though, just change the laws.

Changing the law for highly politicized situations is damn near impossible today.

> can see VC folk cannibalizing big tech if there's enough money in it

Vance’s circle has never been in the business of disrupting Big Tech. They’re looking to sell to them. (Also the White House pigeons have more influence than Vance inasmuch as they might shit on Trump and thus catch his attention.)

Android is not nearly as profitable as you think and how would you make money from Chrome?

I mean, Vance's first job in VC was becoming a partner at Thiel's Mithril Capital in 2015, then he moved to Revolution LLC which was founded by Steve Case (of AOL fame), then he co-founded a VC firm with a former colleague from Mithril and funding from Peter Thiel.

So I mean, he's not "big tech" in the sense of working with or for the few huge corporations that control what we see and read and how we do it, but he's "big tech" in the way of being highly influenced by Silicon Valley billionaires and their "government just gets in the way, down with regulations and laws so I can get more wealth and power" ethos.

I can’t help but feel democracy needs a huge amount of separation between the legal and political systems to remain functional.

As in attorney generals, judges etc. should be appointed by a non political process. I think any rebuttals of the form ‘the other side did it too’ just add weight to this viewpoint.

Also consider that a good portion of Apple's services revenue is from services running on GCP, which would be prohibited. They could go all-in with AWS and Azure, but that's a significant tech change and reduces their negotiating power with those alternatives.

From a legal perspective, Apple's biggest concern, by far, is that this case could set a precedent for using courts to sanction Apple without letting Apple in court. Next to that, revenue is meaningless. Because they can take your revenue from whatever source via judgement, without giving you so much as an opportunity to file a brief in front of the court.

This is one time where there is much more on the line than money. At least for Apple. Maybe for everyone if the Supremes were to say this is OK. (Unlikely in the extreme, but still.)

Apple has enough spare cash to buy a small country. They can build a search engine if they wanted to.

There's a reason there are only a dozen or so successful search engines worldwide, and maybe five successful image search engines. The margins are razor thin, it's a constant battle against "SEO optimisers" trying to ruin search engines for profit, and the moment they get popular governments start coming up with very creepy requests and demands.

It'll cost them billions and they won't know if they can even beat Google before Google drops them as a client for trying to compete with them, taking out a lucrative multi billion dollar deal for a default setting.

No, I think they'll just contract Microsoft Bing and rid themselves of the risks. They're already incorporating Microsoft's side OpenAI side project into their service stack, so it'd just make sense to couple further. Maybe the American government will sue them for that deal as well, but before that's final there will be years of not decades of lawsuits and appeals.

> Now that they're not encumbered by the Google deal: build their own search engine.

"Encumbered"? Apple wants a deal with Google search. Apple is 'self-encumbering' themselves: Apple wants the deal so they don't have go through the rigamarole of building it themselves.

Building would cost a lot and they'd also not be getting cash from Google: so they're doubly hit.

They have the google deal specifically because they don't want to be in the search engine business.

> In a declaration filed with the U.S. District Court in Washington, Apple Senior Vice President Eddy Cue said creating a search engine would require diverting significant capital and employees, while recent AI developments make such an investment "economically risky."

https://fingfx.thomsonreuters.com/gfx/legaldocs/zgvoalybovd/... declaration.pdf

Yup! And the fact that Apple has so far appeared completely uninterested in doing this (compare this to how aggressively Apple competes against Google Maps!) proves that this anticompetitive financial arrangement harms competition, which harms consumers (and probably even harms advertisers, since having Google Search in such a dominant position means Google has much more pricing power to sell ads than they would if a large chunk of iPhone users moved over to Apple Search).

> I seriously doubt Apple would move to Bing by default, even if there were some short term monetary gain. Using a subpar/cluttered search interface is so far off from their brand image.

> I find it 10x more likely Apple would suddenly find the motivation to make their own search engine if forced to end their deal with Google.

I find it 10x more likely that in such case they would use white label Bing and do front-end on their own.

> I find it 10x more likely Apple would suddenly find the motivation to make their own search engine if forced to end their deal with Google.

I think that could only work if someone successfully makes the case internally that an Apple search engine built in to Safari (not as a first-class web app) would boost the Apple brand and/or Safari market share enough to justify it. Maybe even offer it as a subscription.

To monetize it with ads would go completely against their DNA -- ad revenue incentivizes companies to violate users' privacy and build a sub-optimal UX. So it would have to be either a subscription or a platform feature.

That would possibly recoup the laziest of users but wouldn't the bulk simply switch to Google, leaving Apple with none of that revenue?

Which pays Google…

It's pretty consistent with what the law actually says. Here's the Sherman Act:

> Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is hereby declared to be illegal.

> Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other per- son or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony

It's very under-enforced, but that's what it says.

True - hadn't spotted the bit about the Search Text Ad bit either.

Or you know, buy some iPhones or MacBooks.

Apple did send traffic to Bing in the past. It wasn't all of their iOS search traffic, but some.

Surprised Apple and Google haven't just come to an agreement for Apple to "create their own" search engine which uses Google as the backend to work around it.

So they want more vertical integration?

If they're still not being paid for those choices, I don't see why Apple would do this instead of just making the default Google (or something else reasonable).

Sure - but what I mean is that Apple seems to be stuck without any good options here. Even if they don't get the $20B/yr, most users will probably either choose google search, or be upset if they don't get google search on mobile safari.

I notice that I don’t see ads in Apple Maps.

Your info might be outdated. Apple Maps is actually better than Google Maps in many ways (e.g. it says "pass this light and at the next one, turn left" instead of "in 300 feet, turn left")

Google search has already become crappy enough. I doubt Apples would do so much worse at this point.