US regulators propose Google breakup, forcing Chrome sale

A court earlier found Google guilty of anti-competitive practices

US regulators have proposed a radical solution to curb Google's monopolistic power: breaking up the tech giant.

In a 23-page document filed with a federal court on Wednesday, the US Justice Department (DOJ) proposed selling Google's Chrome browser and imposing strict restrictions on Android to curb its dominance in the search engine market.

The DOJ's action follows a court ruling in August this year that found Google guilty of anti-competitive practices.

The DOJ's primary concern is Google's control over search distribution and the preferential treatment it receives on platforms like Apple's iPhone. The department argues that Google's monopoly power allows it to pay exorbitant fees to be the default search engine, making it difficult for competitors to gain a foothold.

The Department argues that a Chrome sale would permanently eliminate Google's control over a critical search access point and level the playing field for rival search engines. While the DOJ stopped short of demanding a full-fledged breakup of Google, it hinted that a divestiture of Android could still be on the table if the company continues to engage in anti-competitive behaviour.

The DOJ aims to prevent Google from favouring its own services, such as YouTube and Gemini, and to force the company to share its valuable search index data with competitors.

"The playing field is not level because of Google's conduct, and Google's quality reflects the ill-gotten gains of an advantage illegally acquired," the DOJ stated its recommendations.

"The remedy must close this gap and deprive Google of these advantages."

The recommendations are part of a broader effort by the Biden administration to crack down on anti-competitive behaviour by Big Tech companies. The DOJ's antitrust division, under the leadership of Jonathan Kanter, has been particularly aggressive in pursuing cases against tech giants.

Google's chief legal officer, Kent Walker, opposed the proposed breakup, arguing that it would harm American consumers and stifle innovation. Walker warned that such a radical intervention would threaten personal privacy and undermine Google's leadership in AI.

"This case is about a set of search distribution contracts. Rather than focus on that, the government seems to be pursuing a sweeping agenda that will impact numerous industries and products, with significant unintended consequences for consumers, businesses, and American competitiveness," Google said in October.

While the company has vowed to appeal the court's ruling and the proposed remedies, it faces a significant challenge in defending its business model.

"Undoing Google's overlapping and widespread illegal conduct over more than a decade requires more than contract restrictions: it requires a range of remedies to create enduring competition," Kamyl Bazbaz, DuckDuckGo's senior vice president of public affairs, said.

The proposed breakup of Google has drawn comparisons to the antitrust case against Microsoft in the late 1990s. In that case, a federal judge ruled that Microsoft had unlawfully leveraged its Windows operating system for PCs to suppress competition. However, an appeals court later overturned the decision to break up the company.

Experts now believe that the precedent set by the Microsoft case may limit the scope of the potential penalties against Google.

The case against Google is one of several antitrust actions filed against Big Tech companies in recent years.

Other tech giants, including Apple, Meta and Amazon, are also facing scrutiny from US and European regulators.