Wall Street’s expectations for a lenient approach by President Donald Trump in the antitrust case against Google-parent Alphabet (GOOGL) are diminishing as the Justice Department calls for a company break-up, signaling a continuation of aggressive regulatory measures.
DOJ demands Chrome divestiture
The Department of Justice (DOJ) proposed that Google be compelled to sell its web browser, Chrome. This proposal reiterates the Biden administration’s request last year for a federal judge to mandate Alphabet to divest Chrome and terminate payments to Apple (AAPL) related to internet searches.
In a recent court filing, the DOJ stated, “Google’s illegal conduct has created an economic goliath, one that wreaks havoc over the marketplace to ensure that — no matter what occurs — Google always wins.” This reflects concerns regarding Google’s monopoly power in the online search domain.
Federal judge Amit Mehta ruled in August that Alphabet illegally maintained a monopoly in online search services, hindering competitors from developing their products. The judge is expected to hear oral arguments regarding possible remedies in April, with a ruling anticipated by early August.
DoubleClick trial and ongoing lawsuits
Alongside the Chrome divestiture case, another antitrust lawsuit against Google is moving forward. The DOJ is pursuing claims that Google’s dominance in the digital advertising market has negatively impacted advertisers and content creators, a case some analysts refer to as the “DoubleClick trial.” Google acquired DoubleClick for $3.1 billion in 2008.
A ruling in this case is expected in spring 2025. The DOJ aims to dismantle Google’s search monopoly by ending agreements that designate Google as the default search engine on various devices, advocating for heightened competition and consumer choice.
The Justice Department reaffirmed its request that Google divest Chrome and halt practices that helped it sustain its illegal monopoly in online search. The DOJ’s filing specifies that Google must “promptly and fully divest Chrome, along with any assets or services necessary to successfully complete the divestiture, to a buyer approved by the Plaintiffs in their sole discretion, subject to terms that the Court and Plaintiffs approve.”
Modifications to DOJ proposals
In a modification of its earlier demands, the DOJ will no longer require Google to divest its artificial intelligence products. Instead, it will require the company to notify federal and state officials before pursuing AI investments. Google has invested heavily in AI, including billions of dollars in startup Anthropic.
Google plans to appeal Judge Mehta’s ruling and submitted its own proposal asserting that minimal changes are necessary. The company suggested allowing continued payments for premium placement while reducing the limitations so that other search engines can compete for placement on devices.
Google’s spokesman, Peter Schottenfels, stated, “The government’s proposals would harm America’s consumers, economy, and national security.” Google’s chief legal officer, Kent Walker, referred to the DOJ’s proposal as a “radical interventionist agenda” that could endanger the security and privacy of millions of Americans and hinder innovation.
Judge Mehta is set to hear arguments on the competing proposals in April. Google has indicated it will appeal any remedies ordered, likely initiating a protracted legal process.
Featured image credit: Pawel Czerwinski/Unsplash
