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Just as Microsoft is believed to have missed the technology world鈥檚 move to mobile platforms because it was so focused on its own monopoly case with the Justice Department, testimony and internal documents suggest Google may have fallen behind in adopting AI because of its own antitrust trial, which concluded in Washington Friday.聽

In Google鈥檚 case, that has been underscored by testimony and other evidence presented during the second phase of the Justice Department鈥檚 trial on how artificial intelligence is impacting its core online search business and opening up new deals for startups.

Last Wednesday, Apple Inc.鈥檚 top dealmaker Eddy Cue roiled Alphabet shares with his testimony. Cue discussed why Apple had chosen OpenAI鈥檚 ChatGPT over Google鈥檚 Gemini product for the iPhones鈥� new AI search feature. He also said Apple is 鈥渁ctively looking at鈥� revamping its Safari web browser to focus on AI-powered search engines.聽

His comments indicate that while Google has worked to protect its dominance in its core search business, AI companies have succeeded in building a viable alternative for answering questions on the internet.

Columbia University law professor Tim Wu calls it 鈥渢he policeman at the elbow鈥� effect: when a monopolist knows someone is watching its every move, it鈥檚 much more careful to avoid being seen as stifling rivals. The whole point of monopolization trials 鈥渋s to shake things up,鈥� said Wu, who served as President Joe Biden鈥檚 competition adviser from 2021 to 2023.

The second phase of the Google trial focused on how to address what a federal judge last year found to be an illegal monopoly. After closing arguments May 29 and 30, Judge Amit Mehta will determine whether to break up the company by divesting the Chrome browser or restore competition to the market in some other way.聽

Justice Department antitrust chief Gail Slater said at a conference in Scotland Friday that the search market has been 鈥渇rozen鈥� for 20 years in terms of competition. 鈥淗ow do we unfreeze that ice block?鈥� she said. 鈥淜ey to all of that of course is scale and data. And that鈥檚 going to be something that will be very important for competition going forward.鈥�

Lee-Anne Mulholland, Google鈥檚 vice president of regulatory affairs, said in a blog post after the trial wrapped that the Justice Department鈥檚 proposals were 鈥渆xtreme鈥� and would harm competition in the industry.

鈥淥ver weeks of testimony, we heard from a series of well-funded companies eager to gain access to Google鈥檚 technology so they don鈥檛 have to innovate themselves,鈥� she said. 鈥淲hat we didn鈥檛 hear was how DOJ鈥檚 extreme proposals would benefit consumers.鈥�

Cue鈥檚 bombshell

Apple had partnered with Google on online search since 2003, earning as much as $20 billion (all figures U.S.) a year for making Google鈥檚 search engine the default option on its devices. Cue was intimately involved in negotiating that deal 鈥� in fact he had testified about it in 2023 as part of the Justice Department鈥檚 first phase of its antitrust case. Mehta ruled last year that Google illegally monopolized the search market through exclusive deals, citing the Apple relationship among others.

For its AI deal, though, the iPhone maker picked ChatGPT. And even though that partnership isn鈥檛 exclusive, Apple still has yet to sign a deal to add Gemini to its phones. Cue barely mentioned Gemini this week when he appeared in court for the Justice Department鈥檚 second phase trial about how to remedy Google鈥檚 illegal conduct.聽

The contrast between Cue in October 2023 and in May 2025 was striking. Two years ago, Cue鈥檚 testimony was grudging and somewhat stilted as he was contractually bound to defend Apple and Google鈥檚 deal.

聽On Wednesday, Cue was unleashed, practically ecstatic about the amazing power of AI, which he called the fourth technological revolution of the past 35 years. As Cue spoke, he repeatedly highlighted AI startups Perplexity and Anthropic鈥檚 Claude.

Cue appeared to be alluding to what Silicon Valley has described as an existential threat to search over the past two years. While AI chatbots don鈥檛 鈥� and can鈥檛 鈥� operate exactly like search engines, many see them as a challenge to the traditional way people have used the internet to find information.聽

Instead of receiving a list of links directing them to sources across the open web, users can now get instant AI-generated answers directly from bots, which are drawing their responses from large repositories of existing human-generated data.

In response to Cue鈥檚 testimony, Google said it has seen an overall increase in queries from Apple devices as users switch from just text-based searches to using voice-activated and image-based search.

Other witnesses have credited the Google trial with opening up business opportunities for other companies.

That the search market is suddenly exciting again is also not an accident but a byproduct of the Google antitrust trial itself. Perplexity鈥檚 Dmitry Shevelenko was explicit that the company鈥檚 recent success in partnering with Lenovo Group Ltd.鈥檚 Motorola wouldn鈥檛 have materialized if not for the Justice Department鈥檚 antitrust suit against Google.聽

It鈥檚 only because Google is 鈥渦nder pressure鈥� that phonemakers 鈥渃arriers and browsers are OK having some of the dialogues they are having,鈥� Shevelenko, Perplexity鈥檚 chief business officer, said in his own trial testimony last month.

Probe starts

Google actually discovered the key technology for the large language models that underlies today鈥檚 AI startups before the Justice Department opened its probe of the company in 2019. The government has argued that Google didn鈥檛 capitalize on that innovation because of its dominance in the market. Google didn鈥檛 really begin integrating it into its search engine until after OpenAI鈥檚 ChatGPT took the world by storm in November 2022.

Google maintains that it spends billions on innovation each year and waited to introduce AI features so that it could do so responsibly.

鈥淔or a monopolist, innovation is difficult because it鈥檚 terrified it might cannibalize its revenue,鈥� Wu said. He noted how Bell Laboratories, AT&T鈥檚 innovation arm, invented dozens of useful technologies, including the answering machine and the technology behind cellphones. But A&T refused to bring them to market, concerned that people might then use landline phones less.

That same 鈥減aranoia about ending the model鈥� 鈥� as Wu called it 鈥� is evident in Google鈥檚 internal documents about AI. In notes from an October 2024 meeting, top Google executives pressed the Gemini team about its impact on Google鈥檚 search and advertising businesses and when they could start incorporating ads into the AI apps.

Vidhya Srinavasan, Google鈥檚 vice president of ads & sommerce, told the group that 鈥渨e aren鈥檛 losing Search/Ads traffic yet, but she feels like this is inevitable, and we should prepare for Gemini鈥檚 success. She wants to accelerate monetizing Gemini with Ads ASAP ... 鈥榳riting is on the wall.鈥� 鈥�

Google said the company hasn鈥檛 seen AI cannibalize search, with only a small slice of homework and coding queries shifting.聽

鈥擶ith assistance from Samuel Stolton, Davey Alba and Julia Love.

Bloomberg