Breaking up Google is on the table for antitrust authorities, but that doesn’t mean it's going to happen easily.
What happened: The U.S. Justice Department laid out a framework of potential options to fix what was ruled as Google's illegal monopoly in online search. They include making parent company Alphabet divest certain units, or providing the data behind Google’s search products.
- Google said the filing was “radical” and would harm consumers, businesses, developers, and competition. The company will file an appeal once a final remedy is decided.
Yes, but: Most analysts think a breakup is unlikely to actually happen. Breaking up a big company like this is rare, and even more seldom done successfully — one of the more recent examples was Microsoft in 2001, and that ended with a settlement that instead got the company to modify its business practices in the web browser market.
- Given that the antitrust case was built around hefty contracts to make Google the default search engine on browsers and devices, something that prevents those kinds of deals may be more appropriate — and attainable.
Catch-up: The filing comes one day after a judge in Google’s legal battle with game developer Epic ruled that the Android app store was an illegal monopoly, ordering a list of requirements that included distributing third-party app stores and letting developers promote billing methods outside of Google. Google plans to appeal.
Why it matters: Regardless of what the DOJ pushes forward with, it shows that it is serious about curbing Big Tech. Suggesting the possibility of a breakup — or even dragging Google through a years-long legal fight — could push the company to accept other remedies.
What’s next: Google is in the midst of another antitrust trial, this one focused on its dominance in adtech. Should Google lose, a break-up could be a more appropriate remedy, since its position in online advertising came through a series of acquisitions that have allowed it to control both the buying and selling sides of the market.