US mulls Google break-up after landmark monopoly case

The US government is considering asking a judge to force Google to break up parts of its business in order to prevent a monopoly in online search.

Google currently processes 90 per cent of internet searches in the US, which led to a landmark court ruling in August that found that the company had built an illegal monopoly

The Department of Justice said that proposed remedies have the potential to reshape how Americans find information on the internet while shrinking Google’s revenues and giving its competitors more room to grow.

“Fully remedying these harms requires not only ending Google’s control of distribution today, but also ensuring Google cannot control the distribution of tomorrow,” the Justice Department said.

The proposed fixes will also aim to keep Google’s past dominance from extending to the burgeoning business of artificial intelligence, prosecutors said.

The Justice Department might also ask the court to end Google’s payments to have its search engine pre-installed or set as the default on new devices.

Google has made annual payments – $26.3 billion in 2021 – to companies including Apple and other device manufacturers to ensure that its search engine remained the default on smartphones and browsers, keeping its market share strong.

Google, which plans to appeal, said in a corporate blog post that the proposals were “radical” and said they “go far beyond the specific legal issues in this case.”

Google maintains that its search engine has won users with its quality, adding that it faces robust competition from Amazon and other sites, and that users can choose other search engines as their default.

Google parent Alphabet, which is the world’s fourth-largest company with a market capitalization of over $2 trillion, is under mounting legal pressure from competitors and antitrust authorities.

A US judge ruled on Monday in a separate case that Google must open up its lucrative app store, Play, to greater competition, including making Android apps available from rival sources. Google is also fighting a Justice Department case that seeks the break-up of its web advertising business.

As part of its efforts to prevent Google’s dominance from extending into AI, the Justice Department said it may seek to make available to rivals the indexes, data and models it uses for Google search and AI-assisted search features.

The Justice Department is expected to file a more detailed proposal with the court by 20 November. Google will have a chance to propose its own remedies by 20 December.

Other orders prosecutors may seek include restricting Google from entering agreements that limit other AI competitors’ access to web content and letting websites opt out of Google using their content to train AI models.

Google said the AI-related proposals could stifle the sector.

“There are enormous risks to the government putting its thumb on the scale of this vital industry – skewing investment, distorting incentives, hobbling emerging business models – all at precisely the moment that we need to encourage investment,” Google said.

“Government overreach in a fast-moving industry may have negative unintended consequences for American innovation and America’s consumers. We look forward to making our arguments in court.”

Additional reporting from agencies.