The U.S. Justice Department is contemplating a groundbreaking move to break up Alphabet Inc.’s Google, following a recent court ruling that found the tech giant guilty of monopolizing the online search market. This potential action marks Washington’s most ambitious antitrust challenge since the failed attempt to break up Microsoft two decades ago.
Breakup and Alternative Remedies on the Table
Sources familiar with the deliberations reveal that the Justice Department is evaluating various remedies, with a full breakup of Google being a prominent option. This would involve splitting off major components of the company, potentially including the Android operating system and the Chrome web browser. Another possible remedy is forcing Google to divest AdWords, its influential text advertising platform. Alternatively, the Department may impose less severe measures, such as requiring Google to share more data with competitors or to implement changes to prevent it from leveraging its search dominance to gain an unfair edge in AI development.
Market Impact and Legal Proceedings
Alphabet’s stock experienced a significant decline, dropping 3.8% early today, following the court’s ruling on August 5, which identified Google’s monopoly in the search market as illegal. The Justice Department’s next steps hinge on Judge Amit Mehta’s approval, who has ordered both parties to prepare for the second phase of the case, which will address potential remedies for restoring competition.
Antitrust Concerns and Future Outlook
Justice Department attorneys have expressed concerns that Google’s search dominance may give it undue advantages in AI technology, potentially stifling competition. The potential remedies under consideration include restrictions on Google’s ability to use web content for AI products without consent and interoperability requirements to ensure that Google’s services work seamlessly with other search engines.
For further details, visit the [full article on Bloomberg https://www.bloomberg.com/news/articles/2024-08-13/doj-considers-seeking-google-goog-breakup-after-major-antitrust-win
