The U.S. government is contemplating the breakup of Google, the largest search engine in the world, citing “pernicious harms” to American users.
The Department of Justice (DOJ) is evaluating remedies following a pivotal court ruling in August that concluded Google unlawfully stifled competition in online search.
Should the DOJ advance these proposals and a judge approves them, it could mark a historic regulatory intervention in the tech industry.
Google has strongly opposed these measures, labeling them as “radical” and “sweeping,” and asserts that they could harm consumers, businesses, and developers.
As the dominant search engine, Google commands approximately 90% of online searches globally.
The DOJ has alleged that Google exploits its other products, including the Chrome browser and Android operating system, to direct users to its search engine, thereby generating revenue through advertising sales.
The DOJ indicated in a recent filing that “Google’s unlawful conduct persisted for over a decade,” employing tactics that fortify its dominance and hinder potential competitors from gaining market entry.
This lack of competition has enabled Google to impose significantly high advertising prices while compromising the quality of those ads and associated services.
The DOJ is considering remedies aimed at preventing Google from leveraging products such as Chrome, its app store, and Android to favor its search engine.
A comprehensive proposal by the DOJ is anticipated by November 20, while Google will submit its counter-proposals by December 20.
What is Google’s Response?
In a recent statement, Google’s vice president of regulatory affairs asserted that the recommendations reflect “government overreach” and could lead to increased consumer costs.
She acknowledged that Google provides its Chrome browser and Android operating system for free to facilitate internet access and product usage.
If these products were to be separated from Google, they would need to find independent revenue streams, potentially resulting in higher costs for users.
Moreover, she emphasized that Google’s payments to companies for being the default search engine subsidize their devices. Thus, cutting these payments could raise the prices of those devices.
Google also contends that the online advertising market remains competitive, noting a shift towards alternative platforms for search, although it maintains over half of the advertising search market.
Will This Be Effective?
Experts suggest that reducing Google’s dominance in the search market will require more than regulatory changes. “It could create opportunities for competitors, including smaller players, to expand their market share, fostering a diverse and competitive environment,” stated a principal analyst at a leading tech consultancy.
However, successful market entry will depend on technological innovation and effective consumer engagement strategies.
The outcome of the Google case could establish a significant precedent for future regulations targeting other major U.S. tech firms, as similar lawsuits have been filed against companies like Meta and Amazon concerning monopolistic practices.
