Divesture is one of the options being sought by the Justice Department, experts see it as unlikely but Google’s business is expected to be impacted
- Breaking up Google is one of the options being considered by the Justice Department after a recent court ruling that Alphabet monopolized the online search market, Bloomberg reported citing people familiar with the matter.
- Other options being pursued include forcing Google to share data with competitors and initiating measures to prevent it from gaining unfair advantage in AI products.
- Units that the prosecutors are seeking to be divested include the Android operating system, Chrome and AdWords (Google’s advertising sales tool).
- The ruling found that Google requires device makers to sign agreements to gain access to its apps such as Gmail and to have Google’s search widget and Chrome installed on the devices ( pointing out that Google paid 26 billion to device makers in 2021 alone) hence preventing other search engines from competing.
- The ruling also established that Google forces websites to allow their content to be used in its AI products and monopolizes advertisements which appear at the top of the search results.
- A separate trial to determine the remedies has been set for September 14 but Google already said that it will appeal the ruling, a process that is projected to take at least two years to complete.
- Experts say the ruling bears resemblance with that of Microsoft. Microsoft was found to have monopolized the PCs market and was asked to divest its operating system or applications business. However, Microsoft’s appeal was successful and was only asked to allow multiple operating systems in PCs.
- Experts also believe that the most likely remedy will be asking Google to do away with certain exclusive agreements with Sam Weinstein, law professor at Cardozo Law School and a former DOJ antitrust lawyer pointing out that a divestiture is rarely ordered for a Section 2 case. However, this will still lead to a significant market share lose for Google unless the firm can successfully defend itself using the rise in competition from ChatGPT.