The Google antitrust case is nothing compared to the 1999 Microsoft case
This is the web version of Data Sheet, Fortune’s daily newsletter on the top tech news. To get it delivered daily to your in-box, sign up here.
It was a warm fall evening in Washington, D.C. in 1999 when we got the call. I was a reporter at the Reuters bureau and already thinking about my weekend plans that Friday when word came from the federal courthouse that Judge Thomas Penfield Jackson was finally ready to issue the first part of his decision in the most important tech legal battle of the time: the Microsoft antitrust case.
Our lead reporter on the story, David Lawsky, was ready to write. My job was to line up at the Government Printing Office over near Union Station, where I eventually got my hands on a printed copy of the 207-page ruling. My then-pony-tail and I also ended up in a photo in the Washington Post the next day.
In his findings of fact, Jackson laid out in minute detail how Microsoft had wielded its dominant power over the PC industry time and time again to squash rival browser maker Netscape.
Five months later, Jackson issued the follow up, a taut 43-page decision with his legal conclusions from the case. No surprise to anyone following the trial, he found Microsoft guilty of violating the Sherman Antitrust Act and ordered a controversial breakup of the company. While many of his rulings survived on appeal, the breakup order did not, and the incoming Bush administration quickly settled the case in 2001.
No one will have to stand in line to be handed a thick paper copy of the judge’s decision in the Google antitrust case that kicked off this Tuesday. But there are a few other differences that are more meaningful—and stranger.
First, the Microsoft case was a controversy at the cutting edge of the tech industry. We were just at the beginning of the Internet explosion that would lead to trillions of dollars of new economic value. Those were the stakes, and the case’s restraints on Microsoft arguably made space for new innovations and new companies to thrive, including Google itself.
By contrast, the Google case seems rooted firmly in the past—in fact, the European Union filed a version of it four years ago. Almost nothing alleged in the Google search case hasn’t already been going on for many, many years. Google pays to be the default search service in a browser? How 2004. Google has its own browser? Very 2008. Google pushes itself on the iPhone and Android? Also 2008-ish. Even if the DOJ wins the case, it seems unlikely to help launch a new wave of innovation.
Second, and even more glaringly, exactly what leverage does Google wield over anyone? Personal computer makers like Compaq and Gateway could not sell their products without Windows software from Microsoft. They were over a barrel. But Mozilla can set its default search service to Google or Bing or DuckDuckGo or anything else. And Apple? Apple has all the leverage. That’s no doubt why it has extracted payments from Google in order to become the default search service on iPhones. Those payments constitute 15% to 20% of Apple’s total annual profits, according to the lawsuit. Profit, not revenue!
Okay, you say, what about Android phone makers? This is probably the strongest part of the case, as Google and Android appear to have struck the same kind of exclusionary agreements that Microsoft did with Windows. But the EU already forced Google to untie its search service from Android phones in Europe. Since March, Android users have gotten to pick a default search service from among three choices. Meanwhile, Google’s mobile search market share hasn’t changed yet. One analyst report forecast only a 10% drop. Yawn.
Finally, the DOJ’s Microsoft case was a stunning tour de force from day one. The succinct 54-page filing quoted the threats of Microsoft execs who wanted to “cut off the air supply” of Netscape and “putting a bullet through the head” of one of their own products in favor of a deal with a competitor. Microsoft got so angry about the excerpts it even waged a campaign with us reporters to ignore the “snippets.” There’s nothing so incriminating in the Google case. The filing even whines that Google warned its employees not to use such language in emails. We’ll have to see how they fare in depositions and on the witness stand, but it’s another way the new case falls short.
My memories of covering the Microsoft case include the larger-than-life figures of Bill Gates and James Barksdale, who were always in the room where it happened; government lawyer David Boies, most effective in his low-key manner demolishing Microsoft witnesses; and Judge Jackson, who liked to offer his blustery opinions even in the middle of witness testimony. I also remember the impressive journalists in the room, such as Ken Auletta, Steven Levy, and the late Wall Street Journal reporting legend John Wilke, the leader of our ragtag coverage army. They wrote many feature stories enlivened by the trial’s colorful protagonists.
Unless the Google case gets settled, we’ll surely have another grand drama. And hopefully a few good magazine stories! But the stakes for the future of tech, and the economy at large, seem so much lower.
Go big or go home. After seemingly failing to find a buyer, struggling short video service Quibi is adding a key new feature. Seems Kberg and the Whit now are amendable to letting their customers watch Quibi videos on television sets, not just phones. New Quibi apps are out for Apple TV, Amazon Fire devices and Google's Android TV platform.
It's OK, he already in my DMs. The New York State Department of Financial Services gave PayPal a “Bitlicense,” allowing the popular payments service to offer customers digital currencies. PayPal wants "to meaningfully contribute to shaping the role that digital currencies will play in the future of global finance and commerce,” CEO Dan Schulman says.
Turning the channel. On Wall Street, Netflix was a big disappointment. The streaming service added only 2.2 million new subscribers, far short of analyst estimates, and forecast another disappointing quarter for the rest of 2020. Netflix shares, previously up 62% this year, dropped 5% in pre-market trading on Wednesday. But messaging platform Snap impressed, with revenue growing 52% to $551 million. Its shares, already up 74% this year, leaped 21% higher in pre-market trading.
Come with me and I'll prove I'm innocent. Don't say Rep. Alexandria Ocasio-Cortez doesn't know how to shake up politics with some new ideas. She live-streamed playing a game of Among Us on Twitch on Tuesday, drawing 430,000 viewers, the third-largest audience ever on the service for an individual stream, Axios notes. AOC's goal was to promote voting.
FOOD FOR THOUGHT
Speaking of the game Among Us, it's a growing hit among teens banned from meeting IRL, as even my 16-year-old son told me the other day. New York Times ace Internet culture reporter Taylor Lorenz has the explainer you need to read.
Among Us is very different than other highly social video games like Fortnite, for instance. It’s more similar to a board game like Monopoly, or a party game like Werewolf, where players need to read personalities and determine if they’re being lied to in order to win. The large group size makes it easy to invite new friends into the group.
“You can meet a lot of people from Among Us, I’ve made a few friends off of it,” said Juan Alonso Flores, 17, a high school student in Florida. “Once you start playing with the same people you start getting to know each other. You get their phone numbers, Discord tags.”
IN CASE YOU MISSED IT
Google says it isn’t a dangerous monopoly. Here are its 4 key arguments By Danielle Abril
What could change at Google if the Department of Justice gets its way By David Z. Morris
Chelsea Clinton’s venture capital firm ramps up By Emma Hinchliffe
Microsoft partners with SpaceX on new push beyond the stratosphere By Jonathan Vanian
How Adobe plans to fight the scourge of deepfakes By Jonathan Vanian
(Some of these stories require a subscription to access. Thank you for supporting our journalism.)
BEFORE YOU GO
I don't think I've seen Stephen Colbert cry before, but the late night talk show host was reduced to tears on Tuesday by country legend Dolly Parton. She sang an impromptu version of Bury Me Beneath the Willow and if you watch this video of it, you may cry too (starting at the 5:45 mark). Just what we need on hump day.