Streets Ahead: Google Monopoly Ruling, AIO Declines

In this week’s Streets Ahead update, SOCi looks at what’s next after the Google monopoly ruling as well as the continued decline in Google AI Overviews (AIO).

Google Monopoly Ruling: What’s Next After the DOJ’s Landmark Decision?

The News Last week, we reported on a significant development in the lawsuit filed against Google by the Department of Justice (DOJ) in 2020. The case resulted in a 277-page decision, concluding that Google is a monopolist and has maintained its monopoly as the default search engine on various platforms. Additionally, Google has been found to have earned monopoly profits from paid search by inflating prices for advertisers, which, in turn, affects consumers.

While no penalties have been issued yet, there is growing speculation about the potential outcomes as hearings are set to begin in early September. Most experts agree that Google will likely end its exclusivity deals and will no longer be the default search engine for Apple, Samsung, Mozilla, and other platforms. However, some believe that further actions are necessary.

Tim Wu, a law professor at Columbia and former economic advisor to President Biden, suggests in a New York Times opinion piece that the courts should require Google to divest from its web browser, Chrome, and its mobile operating system, Android. He argues that such a move would create a more competitive environment for rivals and drive innovation.

Kevin Indig, a prominent industry analyst, also sees the possibility of Google being broken up, with Alphabet potentially having to spin off certain assets to prevent it from further consolidating power in search and advertising. Indig specifically mentions the potential divestment of YouTube, Chrome, and Android. He further argues that Google should be required to share click-behavior data with the open market, allowing other search engines to train on it and reducing Google’s dominance in the search engine market.

Why This Matters The likelihood of Google losing its status as the default search engine on Apple and other platforms is high. However, it is still uncertain how this might impact overall search engine usage. Depending on future rulings and penalties, the DOJ’s actions could lead to reduced advertising costs.

If Alphabet is forced to divest from products like YouTube, Chrome, and Android, it could pave the way for increased innovation and better services from competitors. While the full impact of these developments remains to be seen, we will continue to monitor the case and provide relevant updates as they emerge in the coming months.

AI Overviews Continue to Decline

The News Recently, we highlighted that Google is enhancing its AI Overviews (AIOs) by allowing users to save them. However, new research from SE Ranking shows that AIOs are appearing less frequently in search results. In July, AIOs were present in 7.47% of searches, down from 8.71% in June.

Despite this decline, certain categories continue to feature AIOs more prominently, including relationships, business, self-care/wellness, and exercise/sports.

Key findings from the research include:

• The average AIO word count has decreased to 397 words, marking a 40% reduction in text length.
• The relationships category remains dominant, with 40.64% of keywords in this niche triggering AIOs.
• Prompt-type queries with a search volume below 50 and a cost-per-click (CPC) of less than $0.50 are most likely to trigger AIOs.
• The latest data shows no Reddit or Quora links appearing in AIOs.

The decline in AIO appearances may be influenced by more than just poor initial feedback. According to Tinuiti, non-branded text ads on computers and mobile phones in the U.S. saw a significant drop in May. Following a reduction in AIOs, click-through rates (CTRs) rebounded, except for non-branded phone text ads.

This suggests that Google’s decision to scale back AIOs could also be driven by concerns about ad revenue.

Why This Matters The ongoing decrease in AIO appearances isn’t surprising given the negative press and challenges Google faced when AIOs were first introduced in late May. It will be worth monitoring whether Google refines these AIOs and gradually reintroduces them into search results.

Additionally, the impact of AIOs on Google search text ads is an important trend to watch. For instance, Tinuiti reported that spending on Google search text ads increased by 13% year-over-year in Q2 2024, largely driven by CPC growth.