Google defends default search engine payments in landmark case

The first day of the US antitrust trial against Google has concluded, in which the DoJ alleged that Google breached competition law to maintain market share. The case, which the DoJ’s lawyer Kenneth Dintzer stated is “about the future of the internet”, relates to billion-dollar deals made between Alphabet and mobile phone companies who set Google as the default search engine. Google argued on Tuesday that these payments were made to cover maintenance and update costs whilst the DoJ has alleged that the payments secured Google’s default status preventing competitors’ access to the market and breaching antitrust law. Although Google’s lawyer John Schmidtlein stated that Google “won these (default search engine) competitions on the merits", Dintzer stated that Google “knew these (revenue sharing) agreements crossed antitrust lines". The trial could last up to 10 weeks with the case considered the most significant US antitrust lawsuit since the DoJ’s litigation against Microsft over 20 years ago.

In commercial tech news, chip company TSMC has announced it will invest up to $100mn in Arm’s IPO. TSMC is joining a number of leading chip companies including AMD, Intel and Nvidia as cornerstone investors in the Nasdaq IPO. Discussing the investment TSMC’s CEO Mark Liu stated that Arm “is an important part of our ecosystem". Bloomberg reported on Monday that orders on Arm’s IPO are already 10 times oversubscribed. This reported oversubscription had increased rapidly from Friday after the FT and Reuters reported that the IPO was 5 and 6 times oversubscribed respectively. With the Arm IPO expected to price today, the company’s filings show a targeted share price of between $47 and $51.

Read more below for a round-up of the key tech policy stories shaping the sector today.

Nvidia has joined seven other tech companies in adding its signature to voluntary AI commitments made by AI companies to the White House in July. The White House announced on Tuesday that Adobe, Cohere, Nvidia, IBM, Salesforce, Scale AI, Stability and Palantir had committed to a number of safer AI pledges. These include watermarking AI-generated content and centre on ensuring that the technology is developed and deployed safely and responsibly. Whilst legislation is being discussed for AI the government is reliant on these voluntary commitments in order to take a role in safeguarding AI innovation.

Reuters reported that the EU Commission is consulting with relevant competitors following changes made to Microsoft’s acquisition of Activision. The EU regulator’s review of its approval for the deal follows concessions made by Microsoft to UK regulators. In a bid to address UK CMA concerns Microsoft agreed to transfer Activision-owned Blizzard’s cloud streaming rights to Ubisoft in all jurisdictions outside the EU. Although the approved licensing terms would remain in effect in the EU, it has been speculated that the changed international terms could lead to a re-opened investigation into the acquisition.

The Bank of Israel is continuing with plans to explore the viability of a digital shekel. The central bank first began exploring the possibility of a central bank digital currency (CBDC) in 2017. A report by the bank in April this year stated that it was monitoring key developments relating to CBDC issuance globally and taking this into account in its decision-making process. Earlier this year an Atlantic Council report found that 98% of countries were exploring the viability of CBDCs whilst a study by the Bank for International Settlements found that 24 central banks will have issued a digital currency by 2030. The Bank of Israel’s governor Amir Yaron stated yesterday “Whether or not we will issue a digital shekel is still an open question, as it is in most if not all other advanced economies".

Reporting by Nick Scott. For a further read:

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Cover photo by Ank Kumar licensed under a Creative Commons?Attribution-Share Alike 4.0 International?license.