A federal judge in Washington, D.C., on Friday, December 5, 2025, ordered Alphabet’s Google to limit all default search and AI‑app contracts to one‑year terms, requiring the company to renegotiate each placement agreement annually. The order applies to long‑standing deals with Apple’s iPhone and Samsung’s devices, as well as other device makers that have historically secured multi‑year default placement for Google’s search engine.
The ruling follows Judge Amit Mehta’s August 2024 antitrust decision that found Google illegally monopolized online search. In September 2025, Mehta barred Google from exclusive contracts and required it to share certain data with competitors. The new one‑year limitation expands those remedies, preventing Google from locking in default placement for extended periods and opening the field for competitors such as OpenAI and new browser entrants to vie for those spots each year.
Google reportedly spends billions annually to secure default placement. In 2021 alone, the company paid more than $26 billion for these agreements, including roughly $20 billion to Apple. The annual renegotiation rule will force Google to re‑evaluate these payments each year, potentially reducing the volume of guaranteed placement revenue and increasing the cost of securing new deals.
The order is expected to erode Google’s advertising revenue base, as default placement drives a significant share of search traffic and ad impressions. By limiting multi‑year contracts, the ruling reduces Google’s ability to lock in market share and may accelerate the adoption of alternative search engines and AI‑powered assistants on competing devices.
Alphabet is expected to appeal the ruling, but the immediate impact is a significant shift in its competitive moat. The decision signals a broader regulatory push to curb Google’s dominance in digital advertising and search, underscoring the growing scrutiny of its core business.
The ruling also has implications for the broader antitrust landscape. It demonstrates the U.S. Department of Justice’s willingness to impose structural remedies that directly affect how a dominant firm negotiates with device makers, potentially reshaping the competitive dynamics of the mobile and web ecosystems.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.