described as the “New Economy”characterized by innovation, dynamiccompetition, multisided platforms, the potential for network effects andlock-in, and novel business models or marketing techniques. Much haschanged in the monopolization landscape since the
decision over adecade ago: the U.S. Department of Justice has held hearings on the appro-priate scope of Section 2 and issued a report (and then repudiated it); theEuropean Commission has risen as a leader in single-ﬁrm conduct enforce-ment by bringing abuse of dominance actions and assessing heavy ﬁnesagainst ﬁrms including Qualcomm, Intel, and Microsoft; China has passedits own antitrust law and become an important stakeholder in debates overthe future of international antitrust.In the United States, the changed landscape has resulted in a new enfor-cement approach that is remarkably direct and honest in identifying itstargets, honing in on high-tech markets, innovative industries, and innova-tive practices. Indeed, large ﬁrms in markets involving innovation, intellec-tual property, standard setting, or the possibility of network effects havebeen put on notice of potential antitrust actions. Google has become themost discussed potential antitrust target, often bandied about by techies,bloggers, and business writers.
This is not without adequate cause.Consider the “warning shot” ﬁred in Google’s general direction by AssistantAttorney General Varney. Analogizing the need for antitrust enforcement tothe Department of Justice’s successful monopolization suit against Microsoftin the 1990s, Varney remarked:
Microsoft is so last century. They are not the problem. I think we’re going to continuallysee a problem potentially with Google, who I think so far has acquired a monopoly ininternet, online advertising lawfully. I do not think that they have done anything otherthan be a spectacular and innovative company.
. . .
I think that this is a classic area toexplore how do you apply [sic] section 2 in a highly innovative, highly networked, not ter-ribly competitive environment.
. . .
, Steve Lohr,
Google, Zen Master of Market
, N.Y. T
, May 17, 2009,
http://www.nytimes.com/2008/07/07/technology/07google.html?pagewanted=print; Steve Lohr& Miguel Helft,
New Mood in Antitrust May Target Google
, N.Y. T
, May 17, 2009,
They Might Be a Little Evil: Why Google Faces Antitrust Scrutiny
,May 23, 2009,
http://www.newsweek.com/id/198855; Farhad Manjoo,
The CaseAgainst the Case Against Google – The Department of Justice Should Take a Hint from theMicrosoft Suit: No More Antirust Actions Against Tech Companies
, July 28, 2009,
http://www.slate.com/id/2223755; Declan McCullagh,
In D.C. Antitrust Circles,How Google Became the Hunted
, CNET N
, Sept. 9, 2008,
http://news.cnet.com/8301-13578_3-10036948-38.html; Declan McCullagh,
On Antitrust, Is Google theNext Microsoft
, July 23, 2007,
http://news.zdnet.com/2100-9588_22-152610.html; James Rowley,
Antitrust Pick Varney Saw Google as New Microsoft
Feb. 17, 2009,
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aG9B5.J3Bl1w; Posting of Erick Schonfeld to TechCrunch, http://www.techcrunch.com/ (May 11, 2009); Fred Vogelstein,
Why Is Obama’s Top Antitrust Cop Gunning for Google?
, July 20, 2009,
http://www.wired.com/techbiz/it/magazine/17-08/mf_googlopoly; WSJ Law Blog, http://blogs.wsj.com/law/ (May 8, 2009, 9:22 EST).
Journal of Competition Law & Economics