In a recent episode of the podcast "Acquired," venture capitalists and hosts Ben Gilbert and David Rosenthal argued that the horrible roll-out of Google’s Bard AI chatbot in February 2023 — which led the company’s stock to drop 8% in a day — was a blessing in disguise. That’s because two years later, after a U.S. federal judge ruled that Google had illegally monopolized online search, he also concluded that the specter of artificial intelligence would ensure the company faced new competition. Google didn’t need to change much about its business, the judge ruled, in part because the looming threat of AI would help solve the problem.

“As flat-footed as Google was when ChatGPT happened, if the outcome of this is they avoid a Microsoft-level distraction and damage to their business from a U.S. federal court monopoly judgment,” Rosenthal said, it was “worth it.” “It actually saves Google.”

In his August 2024 decision, Judge Amit Mehta held that while the tech giant, owned by Alphabet Inc., came to dominate because of its superior search engine, it stayed on top in part because it pays billions of dollars a year to rivals like Apple Inc. and Samsung Electronics Inc. to maintain the status quo.

A year later, he issued another 230-page ruling about how to resolve that illegal conduct, holding that Google would be required to do almost nothing different. The search giant would not be forced to sell off its popular Chrome web browser — as the Justice Department sought — or to stop paying those billions to ensure its search engine remains on top. “The emergence of GenAI changed the course of this case,” Mehta wrote. No one at the original monopolization trial testified that AI would upend the search industry, he said, while the 2025 remedies hearing was chockful of witnesses who said as much.No one really agreed, though, on who would do the upending. Microsoft CEO Satya Nadella testified about his angst over Google extending its search dominance into AI, which led the company to invest more than $13 billion in OpenAI. The Justice Department repeatedly argued that fear of losing its search monopoly led Google to downplay its own AI advances. Meanwhile, Google’s Prabhakar Raghavan, who led search at the time, testified that he lay awake at night fearful that young people were no longer relying on ‘Grandpa Google.’

Mehta seems to have bought the idea that Grandpa Google was threatened by AI, and to an extent it’s true: Some users are turning to chatbots instead of search engines, and AI companies like Perplexity and OpenAI are launching their own web browsers. But that alone may not be enough to end Google’s monopoly, as two recent books explain. By declining to enforce harsher remedies, Mehta’s ruling falls into what Columbia law professor Tim Wu calls “the persistent dream of the self-correcting economy.”

Monopolies always fear being displaced by novel technologies, because the latest advances represent a new avenue of competition, Wu writes in The Age of Extraction (Knopf, November 2025). AT&T was deeply suspicious of technologies it didn’t control, for example, only permitting answering machines, modems and eventually online services to connect to its network when forced by the federal government. But this reticence doesn’t make monopolies easier to displace, says Wu, even when new technologies are on the horizon.

“The theory of self-correcting economic power routinely ignores the predictable actions of those who have economic power,” he writes. As we will likely rediscover with Google, “The great monopolists are not passive.”

The monopolist’s playbook

Lack of competition breeds complacency. As Lily Tomlin’s AT&T operator famously opined in a 1976 Saturday Night Live skit, “We don’t care. We don’t have to. We’re the phone company.” That dynamic is alive and well on the internet, as digital advocate Cory Doctorow argues in his newest book. Companies will always seek to extract the most money for the least effort, he writes, even degrading or “enshittifying” their products unless disciplined by competition or regulation.

Enshittification (MCD, November 2025) is both the title of Doctorow’s book and the word he coined to describe why the tech platforms of today, which were once so promising, are now so terrible. Enshittification, he argues, is not “a sweary word for capitalism”; it’s better understood as a theory of unchecked monopoly power.

Without competitors, Doctorow argues, companies stop innovating and instead start squeezing customers, who ultimately pay up because they have nowhere else to go. Doctorow spends an entire chapter on how Google is emblematic of what happens when companies lack competition. “Google’s poor search quality is a choice,” he writes. “Google Search sucks because Google wants it to suck, because when we have to run multiple search queries, Google shows us more ads and makes more money.”

Google disputes Doctorow’s characterization of its search product, saying the company only launches changes “we’ve tested and confirmed will improve the experience.”

“People choose to use Search because it provides helpful, trusted results for the vast range of questions that they ask every day, and we launch thousands of improvements every year to make it work even better,” says Peter Schottenfels, a Google spokesperson.

Both Wu and Doctorow’s books are rife with examples: Amazon.com Inc. sellers shelling out as much as 50% of their revenue for services related to the company’s marketplace; developers who must pay Apple or Google a 30% fee to reach consumers through app stores; even newer companies, like Unity Software Inc., seeking to impose fees on developers that built products on its video game engine. As Doctorow explains, borrowing from Greek economist Yanis Varoufakis’ concept of Technofeudalism, these platforms have created “an economic system in which the majority of value is being captured by the people who own the stuff, at the expense of people who do stuff.”

The theme, throughout, is that monopolies are good for investors, who make a lot of money, but bad for everyone else because they operate as a tax on the rest of the economy. These may not seem like novel arguments in 2025, when anti-monopoly politicians and regulators have gained notoriety on both sides of the Atlantic and a litany of tech giants have had to fend off antitrust accusations in court. But the tech giants remain in an enviable position. Today the Magnificent 7, as they’ve come to be known — Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla — make up about one-third of the value of the S&P 500, dwarfing entire industries with their scale and potential impact on the rest of the market.

And Mehta’s decision on Google search remedies illustrates a new risk: that policymakers will treat AI as a deus ex machina, capable of felling giants so they don’t have to.

The race to dominate AI

In his decision, Mehta marveled at the “astonishing” amount of money flowing into the development of AI and said that barring Google from paying others to install its Gemini AI app would disadvantage the search giant. AI companies “already are in a better position, both financially and technologically, to compete with Google than any traditional search company has been in decades,” he wrote. That offers “strong reasons not to jolt the system and to allow market forces to do the work.”But, as Wu argues, markets do not automatically correct themselves, particularly when money and power are brought to bear.While it’s true the AI race has introduced new companies — OpenAI, Anthropic and Perplexity to name three that offered views during the Google search remedy hearing — none of the players are truly independent. OpenAI is partly owned by, and heavily reliant on the infrastructure of, Microsoft. Both Amazon and Google have invested in Anthropic. Perplexity’s funders include Amazon founder Jeff Bezos and Nvidia. Even xAI, another “new” entrant in the AI race, is funded by Tesla founder Elon Musk. And, with the exception of Musk, all of these backers are facing either antitrust lawsuits or investigations for illegally dominating key sectors of the economy.

“The current tech firms see AI rather as the telegraph monopolist saw Alexander Graham Bell’s telephone — as a risk to be controlled,” Wu writes. “Today’s platform monopolists would prefer it if artificial intelligence remained a complement to their core business models.”

Google is certainly unlikely to be passive now that a judge has given it the green light to continue using the money derived from its monopolies to pay for the development and dominance of its AI tools.

It’s notable that Eddy Cue — the Apple dealmaker who negotiated the agreement with Google — testified that the company is looking to incorporate AI into its devices by harnessing what’s been built by others, rather than building something itself. This month, Apple reached a deal to integrate Google’s AI into Siri. Apple wants to sell iPhones and make others pay for access to its users, not upset the current market dynamics.

The Acquired podcast hosts honed in on this point about complementarity in discussing why they believe Google will likely do better than its AI rivals in the long run. Only Google has the advantage of up-to-date information from its search monopoly and YouTube. It has massive computing resources from its main business and its cloud computing arm. It has the ability to personalize models thanks to its massive collection of information about users. And it has lots and lots of money.

“None of these AI companies are generating net income, and just because they’ve raised a huge amount of money, it doesn’t mean that will last forever,” Gilbert said. “If the spigots ever dry up, Google doesn’t have any self-sustaining competition in their old search business or in AI.” And that’s particularly concerning, Wu notes, because we don’t yet know what kind of tool AI will turn out to be.

“The happier version of the story is one in which AI becomes something that helps workers get more done, and in theory, go home early from work and take longer vacations,” Wu says. Whether that’s the version we get depends in large part on who builds it, and whether they’re disciplined by competition or driven by a desire to defend the status quo.

©2025 Bloomberg L.P. Visit bloomberg.com. Distributed by Tribune Content Agency, LLC.