Competition lawyers propose "ladder of investment" approach to dismantle Google search monopoly
Telecommunications strategy adapted for search market could enable competitors to build infrastructure gradually while accessing Google's systems.
Competition lawyers Thomas Höppner and Steffen Uphues published a 30-page academic paper on June 13, 2025, outlining how the "Ladder of Investment" framework successfully used in telecommunications deregulation could restore competition in online search markets. The proposal comes as global regulators struggle to design effective remedies following multiple antitrust rulings against Google's search monopoly.
According to Höppner and Uphues, the current remedy discussions focus primarily on breaking up Google or banning default search agreements, but fail to address the fundamental infrastructure barriers that prevent meaningful competition. Their research demonstrates how competitors could progressively build independent search capabilities while initially accessing Google's web index, click-and-query data, and computing resources through mandatory licensing agreements.
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Summary
Who: Competition lawyers Thomas Höppner and Steffen Uphues from Hausfeld law firm authored the academic paper proposing regulatory framework changes.
What: A "Ladder of Investment" approach adapted from telecommunications deregulation that would require Google to provide graduated access to its search infrastructure, enabling competitors to build independent capabilities progressively.
When: The 30-page academic paper was published on June 13, 2025, through SSRN (Social Science Research Network).
Where: The proposal addresses global search markets but specifically references implementation through UK Digital Markets legislation, EU Digital Markets Act modifications, and US antitrust remedy proceedings.
Why: Current remedy proposals fail to address fundamental infrastructure barriers preventing meaningful search competition, necessitating a structured approach that enables progressive competitor development while maintaining innovation incentives.
"The key policy question turns to a suitable access regime," the authors state in their analysis. The ladder approach would allow search engines and AI-powered answer engines to gradually develop proprietary infrastructure in five distinct phases, from complete reliance on Google's systems to full independence.
The paper identifies Google's market share between 75% and 95% across global markets since 2004, with current dominance reinforced by three primary barriers: comprehensive web indexing infrastructure, exclusive access to massive datasets from user behavior, and control over distribution channels through default search agreements. According to the research, Google's web index contains approximately 400-600 billion pages, while Microsoft's Bing maintains significantly smaller coverage and independent competitor Brave operates with only 20 billion pages.
Google's data advantage stems from processing 19 times more mobile queries than all competitors combined in 2024, generating superior click-and-query datasets essential for algorithm training. The company's superior financial resources enable substantial server capacity investments unattainable for most competitors, creating compounding advantages through network effects.
The proposed five-step ladder begins with wholesale syndication where new entrants resell Google's complete search service under their own branding while paying higher access fees. Step two provides bundled access to Google's web index, data, and computing resources, allowing competitors to apply custom ranking algorithms and display preferences while reducing costs compared to wholesale arrangements.
Step three enables unbundled access to portions of Google's index and data as competitors develop their own indexing capabilities for frequently searched websites. This phase permits selective use of Google's infrastructure for rare "long-tail" queries while building independent systems for common searches.
The fourth step provides standalone access to Google's click-and-query data for competitors operating comprehensive proprietary indices but requiring additional datasets for algorithm optimization. The final phase achieves complete independence from Google's infrastructure, with access obligations potentially eliminated once sufficient competitors reach this level.
Pricing mechanisms prove critical for the framework's success. Access fees must balance incentivizing Google to maintain high-quality infrastructure against enabling competitor investments in independent capabilities. The authors suggest initially low pricing covering incremental costs, with gradual increases creating stronger incentives for infrastructure investment over time.
The approach addresses criticism that data sharing reduces Google's innovation incentives by ensuring profitable access arrangements while preventing competitors from enjoying unearned advantages. Regulators could implement dynamic pricing beginning at incremental costs for the first decade, encouraging market entry during the crucial initial phase following regulatory intervention.
Multiple search engine differentiation opportunities emerge under this framework. Competitors could emphasize environmental sustainability by promoting ecologically committed websites, offer enhanced privacy through depersonalized results, integrate AI-generated answers with source attribution, prioritize human-created content over artificial intelligence output, or adjust advertising density according to user preferences.
The telecommunications precedent demonstrates the model's practical viability. European regulators successfully applied ladder principles during the 1990s and 2000s, enabling gradual market liberalization as new entrants progressively invested in independent infrastructure while initially accessing incumbent networks.
Current regulatory gaps limit effective competition. The European Union's Digital Markets Act requires Google to share click-and-query data but mandates no web index access, rendering the data obligation largely ineffective without corresponding search infrastructure availability.
Competition authorities and courts globally could implement this framework through antitrust remedies or sector-specific regulations. The UK's new Digital Markets, Competition and Consumers Act 2024 provides regulatory mechanisms for such interventions, while ongoing US Department of Justice remedies proceedings against Google present immediate implementation opportunities.
Market benefits extend beyond search engine diversity. Advertisers currently face limited alternatives to Google's advertising platform due to the company's traffic dominance, resulting in higher costs passed through to consumers. Competition and Markets Authority estimates indicate search advertising costs equivalent to nearly £500 annually per UK household could decrease through effective competition.
Publishers would benefit from increased click-through rates as competing search engines prioritize organic results over advertising-heavy displays that characterize Google's current approach. Competition could incentivize result quality improvements rather than revenue maximization through advertising placement.
Google maintains that its success results from superior product quality rather than anticompetitive conduct, arguing users choose its services based on merit. The company plans to appeal current monopoly findings while emphasizing its contribution to economic activity and business growth.
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However, multiple courts have rejected these arguments. US District Judge Amit Mehta ruled in August 2024 that "Google is a monopolist, and it has acted as one to maintain its monopoly," finding the company violated antitrust laws through exclusive distribution agreements with device manufacturers and browsers.
The ladder framework offers a structured alternative to blunt breakup proposals or isolated interventions that fail to address systemic infrastructure barriers. By enabling progressive competition development, the approach could establish sustainable market contestability while preserving innovation incentives for both incumbents and challengers.
Implementation success depends on regulatory coordination across multiple jurisdictions and careful calibration of access pricing mechanisms. The authors emphasize that effective competition requires enabling meaningful product differentiation rather than mere resale arrangements that duplicate Google's offerings without adding user value.
As regulators worldwide grapple with designing effective remedies for digital market concentration, the ladder approach provides a tested framework for gradually dismantling monopoly structures while fostering genuine competition through progressive infrastructure development.
Timeline
- June 13, 2025: Thomas Höppner and Steffen Uphues publish "A Ladder of Investment to Competition for Online Search Services" academic paper
- January 14, 2025: UK CMA launches strategic investigation into Google Search dominance
- August 5, 2024: Federal court rules Google monopolized search market
- April 21, 2025: DOJ unveils plan to end Google's illegal search monopoly
- April 17, 2025: Court rules Google's illegal ad tech monopoly harmed the open web