The U.S. Justice Department is exploring the possibility of breaking up Alphabet Inc.’s Google after a landmark court ruling declared the company’s dominance in the online search market to be illegal. This would be Washington’s most significant move to dismantle a tech giant for monopolistic practices since the failed attempt to break up Microsoft Corp. two decades ago.
Breakup or Alternative Remedies?
Sources familiar with the deliberations reveal that a full breakup of Google is on the table, with potential divestments including its Android operating system and the Chrome web browser. Less drastic remedies under consideration involve enforcing data-sharing requirements with competitors or implementing measures to curb Google’s advantages in artificial intelligence (AI) development.
Market Impact and Legal Developments
Following the court’s ruling on August 5, Alphabet’s stock plummeted by 3.8% in early trading, reflecting investor concerns. Judge Amit Mehta’s decision found that Google’s monopolistic practices extended to both its search engine and search text ads, putting significant pressure on the company to address these issues.
Government’s Strategy and Potential Breakup
The Justice Department’s plan, if enacted, would require judicial approval from Mehta, who would oversee compliance. A breakup of Google would be the most significant such action since AT&T’s dismantling in the 1980s. The government’s proposals could also include prohibiting exclusive contracts that prevent competition, a central issue in the antitrust case.
Focus on AI and Data Access
The Justice Department has expressed concerns that Google’s search dominance provides it with undue advantages in developing AI technologies. Remedies could involve preventing Google from using website content for AI products without consent or enforcing data-sharing obligations with rivals like Microsoft’s Bing or DuckDuckGo.
For further details on this evolving case, read the full article.
