Nobel Prize winner calls for Europe to break Google’s monopoly

Google

Google is facing a tough legal battle in the US with the Department of Justice looking to curtail its monopoly. Now, Daron Acemoglu, a professor at the Massachusetts Institute of Technology and winner of the 2024 Nobel Prize in Economic Sciences, has called on Europe to take strict measures against the tech giant.

In an op-ed for The Financial Times, Acemoglu said that big tech companies have “not only dominated markets through aggressive acquisitions, lobbying, and the systematic erosion of competition — they have embedded themselves within the machinery of government.”

Google has had trouble in the past with the European Union and faces an antitrust case. Acemoglu said that monopolies “bad for innovation”. The European Union has already moved in this direction with the Digital Markets Act and the Digital Services Act. But the Google ad tech case, Acemoglu argued, offers a chance to go further — restructuring the ecosystem itself rather than relying solely on fines

He cited the example of AT&T, whose forced patent licensing and eventual breakup in the mid-20th century helped catalyse the digital revolution. “My fellow MIT economist Simon Johnson and I propose a 50 per cent levy on digital ad revenues above $500mn annually to curb Google and Meta’s dominance and create space for competitors,” wrote Acemoglu.

The idea, according to the Nobel Prize winner, should be to rein in power, redistribute market opportunity, and reduce the exploitative use of user data for profit.

Acemoglu says it’s time for Europe to act decisively. "For too long, Silicon Valley has dictated the rules of the internet, shaping markets to serve its own interests while competition dwindles and inequality soars," he said. Europe, according to Acemoglu, "can show that democratic institutions, not monopolies, should shape our digital future."